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HISTORY 



OF 



Political Economy 

IN EUROPE 



BY 



jEr6me-adolphe blanqui 

SCrCCESSOR TO J. B. SAY IN THE CHAIR OF POLITICAL ECONOMY IN THE CONSERVATORY OP 

ARTS AND TRADES (COLLEGE DE FRANCE) ; MEMBER OF THE ACADEMY OF MORAL 

AND POLITICAL SCIENCES (INSTITUTE DE FRANCE) ; PROFESSOR OF 

HISTORY AND INDUSTRIAL ECONOMY AND DIRECTOR 

OF THE SCHOOL OF COMMERCE AT PARIS. 



TRANSLATED FROM THE FOURTH FRENCH EDITION 

BY 
EMILY J. LEONARD 

WITH PREFACE BY 

DAVID A. WELLS 
APPENDIX AND INDEX BY TRANSLATOR, 



NEW YORK & LONDON 

G. P. PUTNAM'S SONS 

i,)^t '$.mth.txhocln ^ttss 

1885 



6 






Press of 

G. P- Putnam's Sons 

New York 



o 



INTRODUCTI 



The plan of the accompanying translation, from the 
French, and reprint for the first time into English, of 
Blanqui's Histoire de L Economie Politique en Etirope, 
received from the outset the very cordial approval of the 
writer and was recommended by him to the publishers. 

However much authorities may differ among them- 
selves as to the exact definition of what is called " Politi- 
cal Economy," and even disagree as to whether the name 
itself can be properly regarded as designating a science, 
all will nevertheless probably agree that under this 
general name is embraced — in the form of historical 
record, or of principles deduced from the philosophical 
study of such record — the results of the general experi- 
ence of mankind in endeavoring to im.prove their ma- 
terial condition ; and if their material condition, then 
also their social, intellectual and moral condition. For it 
is to be remembered, if to any the last part of this 
statement may seem more broad than is fully warranted, 
that the material needs of man must first and always be 
fairly satisfied before morality, certainly in any high de- 
gree, is likely to exist among the masses ; and further- 
more, that something of material abundance or wealth 



9 



VI INTRODUCTION. 

considered as an instrumentality for the diffusion of a 
branch of knowledge most useful among men, its repro- 
duction and circulation in the United States at the present 
time would seem also to be most opportune. For there is 
no one truth or series of truths concerned with our mate- 
rial progress as a nation, which the people of this country- 
need more to have continually demonstrated, and in 
season and out of season impressed upon them, than that 
labor exercised conjointly with skill and frugality, is the 
only path for the permanent attainment of great mate- 
rial abundance ; and that all attempts to increase the 
production and equalize the distribution of wealth by 
establishing through legislation, fiat money or fiat prop- 
erty,, (credits, titles, interest in property created without 
labor), by interfering with and restricting exchanges, by 
arbitrarily regulating the price of money or other com- 
modities or services, and by instituting inquisitorial, 
vexatious, and unnecessarily multiple taxes, invariably 
tend to encourage the spirit of speculation rather than 
of production, to undermine and weaken popular moral- 
ity, and to impair rather than further a healthy national 
development. The authors of such attempts at the pres- 
ent time, as well as in former days, have undoubtedly in 
many instances a sincere belief, that they have dis- 
covered something new in the domains of economic 
truth, and that the circumstances in respect to v/hich 
they propose to legislate are peculiar, untried, and not to 
be judged by the results of any former experience. An 
examination of the records of the past would, however, 
soon satisfy them that all such schemes, in place of hav- 
ing anything of originality, are but repetitions of old im- 
becilities ; and that their authors are simply following in 



INTRODUCTION. V 

by Turgot, Quesnay, Adam Smith and others. But as 
already shown, the experience itself dates back to the 
very dawn of civilization, and in its lessons and applica- 
tions has ever since constituted the foundation and 
framework of every structure of progressive human so- 
ciety, irrespective of locality upon the earth's surface or 
race differences in its individual constituency. 

To attempt a narration of these experiences in Europe 
from the earliest period — their successes and their fail- 
ures — was the task that M. Blanqui proposed to himself 
in writing the history under consideration. The result 
of his labors has been of necessity imperfect, because 
the material for constructing a complete record does 
not exist ; and because the restriction of the discussion 
of such material as is available, which the author at the 
outset seems to have prescribed to himself, namely, 
two small i2mo volumes (in the French edition), did not 
admit of the entering at any great length into details, 
or the accomplishment of much other than the presenta- 
tion of the more important economic transactions in the 
history of Europe, and the extent of their influences in 
promoting or retarding the world's material progress and 
development. Nevertheless the book as it exists to- 
day, with its record terminating in 1842, is in the highest 
degree instructive, and in a popular sense, exceedingly 
attractive. It is moreover, one of the comparatively few 
books published during the last half century which has 
attained a world-wide reputation, and its translation and 
present re-publication fills a place, which so far as the 
observation of the writer extends, is not supplied by any 
other work in the English language. 

Important, moreover, as was the original publication, 



iv INTRODUCTION. 

must be earned and saved before leisure for study can 
be obtained or the scholar can exist. 

Man became an economist at the moment when, through 
foresight and the exercise of labor and frugality, he began 
to anticipate and make provision for his future material 
needs and contingencies ; and he undoubtedly at the 
same time began to appreciate the fact that the acquire- 
ment and use of capital — in the first instance undoubted- 
ly a rude implement or contrivance for facilitating the 
obtaining of food and clothing, or a domesticated animal 
— by rendering him superior to his physical surround- 
ings, elevated him at once in the scale of being. He 
became a political economist at the moment, when in 
association with his fellow men, he began to exchange the 
products of his labor, and to provide for increased abun- 
dance and better and more varied products, through the 
division of labor, the protection of life and property, and 
the invention of tools and machinery for the facilitating 
of both production and exchange. Political economy 
thus first established, developed and became complex 
as civilization advanced, as wealth and the forms of 
wealth multiplied, and as the facilities for social and 
commercial intercourse and the interchange of products 
became greater. According to this view, it is a mistake 
(as M. Blanqui has pointed out) to refer the origin of 
political economy to a very recent period ; so recent in 
fact, as many suppose, as the latter half of the eighteenth 
century. It is indeed true that at the period referred to, 
the record of the experience of mankind in the work of 
bettering their material condition was for the first time 
carefully and philosophically studied, and the principles 
deducible from such experience elaborately formulated 



INTRODUCTION. VJJ 

the footsteps of many predecessors, who have thought to 
bring reputation to themselves, and prosperity to the 
masses by making warfare upon natural laws, with the 
result, in every instance, of failure and disaster. And in 
presenting evidence in support of these propositions, 
derived from unquestionable historic precedents and ex- 
periences, and in such a manner as admits of ready 
comprehension, the history of Political Economy by M. 
Blanqui is calculated to perform a service the value of 
which cannot well be over-estimated. 

David A. Wells. 
January^ i88a 



BIOGRAPHICAL SKETCH OF M. BLANQUI. 



Jerome-Adolphe Blanqui, the economist, was born at Nice, 
in November, 179S. His father, Jean Dominique Blanqui, a 
magistrate, had been one of the deputies to the National Con- 
vention, where he represented the department of the Maritime 
Alps ; and he was among those who, in 1793, signed the protest 
against the Jacobin measures of May 31st and the following 
days, and was one of the seventy-three whose arrest was de- 
creed ; he was subsequently member of the Council of the 
Five-hundred ; was afterwards sub-prefect of Puget-Theniers, 
until 1814 ; sub-prefect of Marmonde during the hundred 
days; a resident of Paris from 1815 ; 'and the author of 
many interesting reports on moneys, weights and measures, 
canals and highways, as also of a pamphlet entitled "My 
Ten Months' Agony," which contains many curious facts in 
Regard to contemporary history. 

Of the mother of Jerome-Adolphe, we find no mention in 
any biographical notice of him. 

Under the direction of his father, Jerome-Adolphe Blanqui 
pursued an excellent course of study at the Lyceum of his 
native city, which he subsequently continued at Paris (where 
he went in 1814), and completed with much distinction. 

He early began his career as an instructor, giving his time 
to chemistry and other sciences allied to medicine, and acting 
as assistant professor of the humanities in a famous school — 
r Institution Massin. This brought him into connection with 
the eminent economist, J. B. Say, who wished him for a dis- 
ciple. The benevolence and the counsels of M. Say inspired 
in his young friend a love for economic studies, which he con- 



X BIOGRAPHICAL SKETCH OF M. BLANQUL 

sequently pursued with much ardor ; and the patronage of this 
most renowned professor, by procuring for the young Blanqui 
the chair of History and Industrial Economy at the School of 
Commerce, opened to him a career to which he was to devote 
his labors and his life. Blanqui applied himself to his work 
with indefatigable zeal, and had the rare merit of combining 
remarkable talents with practical good sense. In 1830, he rose 
to the position of director of this important school, and in 
1833, he succeeded J. B. Say in the professor's chair in the 
Conservatory of Arts and Trades. It was during these pro- 
fessorships that he wrote this History of Political Economy, 
the first edition of which was published in 1837. A course of 
lectures which he delivered in the latter year, on " The His- 
tory of Industrial Civilization among European Nations," was 
largely attended. Other courses, both at the School of Com- 
merce, where he delivered several remarkable lectures, and at 
the Conservatory of Arts and Trades, in connection with his 
professorship there, all had for their aim the promotion of 
manufactures and commerce. Among the lectures were his 
report on the economic and moral condition of Corsica, in 
1838, read at the Academy of Moral and Political Sciences, 
to which he had been elected in June of the same year ; the 
report on the economic condition of French possessions in 
Algeria, the first writing giving a true account of affairs in that 
country (whither he had been sent by the Academy to examine 
and report), read at the Academy in 1839, and his report on 
the Life and Labors of J. B. Say, also read at the Academy. 
In all these we find clear indications of his zeal for manufac- 
tures and commerce. He made several journeys for the same 
object, during which he traveled over nearly all Europe and a 
part of Asia and Africa. These travels served to increase his 
knowledge and give maturity to his judgment. He was one of 
the founders of the J^ournal des Economistes^ and one of the edi- 
tors of the Dictionary of Manufacturing, Commercial and Agri- 
cultural Industry. Spirited articles from his pen were con- 
stantly contributed to papers and magazines where matters on 
political economy and questions of public policy found access, 
from the Producteur, which raised the standard of St. Simor^ 
to Figaro, the Courrier Frangais, and the Dictionnaire des Mer- 



BIOGRAPHICAL SKETCH OF M. BLANQUI. xi 

chandises. Few writers or professors have had so great ardor 
and activity, or been distinguished by labors so facile or so 
fecund. 

From 1846 to 1848, Blanqui was member from Bordeaux of 
the Chamber of Deputies, where he was noted for his enlight- 
ened views and his labors on commissions. In 1851, the In- 
stitute (Academy of Moral and Political Sciences), which 
highly valued his abilities, sent him to London to make a 
report of the World's Fair, and also to furnish a complete 
account of London in its financial and other aspects, a task 
which he performed to the satisfaction of the savants who 
employed him. He also contributed a series of articles to the 
journal La Presse, in 185 1, on the London Exhibition. 

By order of the Academy, he had undertaken the great and 
important' work of investigating the condition of the Rural 
Population of France, and had devoted three years to the study 
of the subject and was preparing to give the public the result, 
when death terminated his labors, Jan. 28, 1854. 

Blanqui stood in the foremost rank among contemporary 
economists. He belonged to that school (now embracing 
nearly every economist of reputation) which advocates the 
principles of commercial freedom. His addresses at the Free 
Trade Congress held in Brussels in 1847, attracted much atten- 
tion. 

Blanqui was ever a vigorous defender of industrial educa- 
tion. At one of the sessions of the Academy, he startled the 
Academicians by asking where a man could be found who 
could give the history of a table-spread, from the wool of the 
sheep to the hall of the Institute. And then he added : 
" Do you even know by what process the goose-quills are pre- 
pared, by the aid of which so many men of genius write ? " 
The Academicians, it is said, smiled, taking the compliment to 
themselves. 

Besides a great number of journalistic articles, M. Blanqui 
published : Travels in England and Scotland (1824) ; Journey 
to Madrid (1826) ; Resume of the History of Commerce and 
Manufactures (1826) ; Elements of Political Economy (1826);' 
A Series of Reports on the Products of French Industry in 
1827 (1827); The English Minister Huskisson, and his Eco- 



xii BIOGRAPHICAL SKETCH OF M. BLANQUI. 

nomic Reform ; History of Political Economy in Europe from 
the Ancients to our day (1837 and 1842); Report on the 
Economic and Moral Condition of Corsica (1838); Report on 
the Economic Condition of the French Possessions in Algeria 
(1840); Travels in Bulgaria (1S41); Considerations on the 
Social Condition of European Turkey (1841); The Working 
Classes in France (1848); Report on the World's Fair in 
London (1850); and the Life and Labors of Jean Baptiste 
Say. 

A Series of interesting letters between Blanqui and M. Emile 
de Girardin, in which free trade and protection were discussed, 
appeared in 1846 and 1847. 

Blanqui was generally alluded to by his French contem- 
poraries as Blanqui aim (the elder), to distinguish him from a 
younger brother, Louis Auguste (born in 1805, at Nice), who 
took a somewhat prominent part in the civil troubles of France 
from July, 1830, to the attentat of May 15, 1848, and was con- 
sequently imprisoned. In 1879, while still in prison, Louis 
Auguste Blanqui was elected to the Chambers. He has 
since been pardoned. 

As a writer, Jerome- Adolphe Blanqui was noted for research, 
lucidity, occasional sallies of wit, frequent passages of great 
brilliancy, and at times a sustained eloquence of diction. 

His History of Political Economy in Europe is the most 
famous of his works. 

(Consult Nouvelle Biographic Gdn^rale, Didot freres, Paris, 
1862 : Dictionnaire de la Conversation et de la Lecture^ Didot 
freres, fils et Cie., 1873 ; Catalogue general de la librairie fran- 
gaise, etc.). 



TRANSLATOR'S PREFACE. 



The principal considerations which have led to this 
translation are the following: 

Blanqui's history is the only existing work combining 
records of the more important economic experiments in 
the different parts of Europe from the early days of 
Greece and Rome down to the time when it was written. 
Some of these records have been obtained from rare 
documents, and most of them are from sources inacces- 
sible to the average student. The reputation of the 
author, too, in consequence of the important services 
he rendered France through his professorship, his writ- 
ings, and the investigations and reports he made under 
the direction of the Institute, give additional value to 
his production, and have created a desire that it be 
brought within reach of all English-speaking readers 
who are interested in economic questions. 

The translator has, for the most part, followed the 
phraseology and the construction of the original, so far 
as the differences of idiom between the two languages 
permit, hoping that the reader may thereby be brought 
into closer contact with the author and be led to a fuller 
appreciation of his thought. The few deviations from this 
method consist principally in the simplification of some 
technical terms that would not be generally understood. 
If the method has been faithfully followed, the transla- 
tion will discover both the merits and defects of the 



xiv TRANSLATOR S PREFACE. 

original, except in so far as it is impossible to adequately 
convey shades of meaning from one language to another. 
Whether there has been a measurable degree of success, 
must be left to the decision of those who appreciate the 
work of a translator. 

An explanation is perhaps due in reference to the em- 
ployment of the terms " exploit " and " exploitation." 
These words, though not common in our language, are 
in occasional use among our best writers, and have been 
retained because no other good English words combine 
the meanings of the French verb '■^exploiter'' (to work, 
use, manage, make capital out of, speculate upon, take 
advantage of, make a tool of, etc.), and its corresponding 
noun. So long as people continue to be " exploited " for 
political and other ends, we think our readers will not 
object to the use of a well-derived word to express the 
act, and especially to one already accepted and employed 
by good authorities. 

The quotations from the speeches of Mr. Huskisson 
and Lord John Russell, as also those from the writings of 
Adam Smith, Malthus, Godwin, and Dr. Ure, have been 
verified, and stand as in their published works. 

So many of the old world experiments have been re- 
peated with similar results in the new, that the tempta- 
tion has often been great to forget that this is the 
history of political economy in Etirope, and to append 
facts on production, trade and finance, drawn from the ex- 
perience of the United States. This has been particularly 
the case in matters relating to tariffs, on which the various 
writings and carefully collected statistics of Hon. David 
A. Wells, and the lectures by Prof. Sumner on the history 
of protection in the United States, afford such a rich 
mine of information. 

The translator entertains a hope that some one may be 
induced by the publication of this work, to prepare a 
similar one embodying the principal economic experi- 
ments of the United States and Canada, with their re- 



translator's preface. XV 

suits. Such a work would be an important addition to 
economic literature. 

A still greater production will be that which shall trace 
the development of economic principles in the world, and 
complete the work whose scope Blanqui partially appre- 
hended, and which it belongs to the Economic Philosophy 
of the future to carry to a successful termination. 

E. J. L. 

Meriden, Ct., March 4th, 1880. 



TABLE OF CONTENTS. 



CHAPTER I. 

PAGB 

Political economy more ancient than supposed. The Greeks and 
Romans had theirs. Its resemblance to that of our time. Differences 
between them. Successive modifications this science has experienced. 
General view of the subject • 5 

CHAPTER II. 

Political economy among the Greeks. Their ideas on slavery. Ad- . 
ministration of their finances. They live by the labor of slaves and the 
tributes of their allies. The theorikon. The Kleruchiae. Each citizen 
considered himself a joint-owner of the state. What a family needed in 
order to live. Public lands. Mines. Money, The temple at Delphi 
a virtual l)ank of deposit. The interest of money in Greece. Im- 
portance attached to the finances. Habits of the Athenians. . . 24 

CHAPTER III. 

Economic systems attempted or proposed in Greece. Laws of Ly- 
kurgus. Republic of Plato. Econofnics of Xenophon. Politics of 
Aristotle. ........... 



CHAPTER IV. 



43 



The Greek colonies and their relations to the mother country. They 
contributed to extend over a great part of Europe the ideas whose 
centre was at Athens and Sparta. They were founded, like ours, by 
emigrations, but they enjoyed a greater independence. . , . 46 

CHAPTER V. 

Political economy among the Romans, in the different ages. They 
are essentially warriors and pillagers under the Republic, Engineer* 

xvii 



XVIU CONTENTS. 

PAGE 

and administrators under the Empire. Their contempt for labor. Im- 
mense devastations they commit. Fall of Carthage. First attempts at 
organization under the emperors. . , . . . . . .51 

CHAPTER VI. 

The Political Economy of the Romans from the commencement of 
the empire. Abuse of conquests. Contempt for commerce. Condition 
of the laboring classes. Insolent aristocracy. Famished populace. 
They take to celibacy. Public and private selfishness. Absence ot 
manufactures. Utility sacrificed to grandeur. ..... 58 

CHAPTER VII. 

* 

Importance of means of communication among the Romans. Sei-- 
vices their great roads might have rendered to civilization and to com- 
merce. Sketch of the principal Roman laws in matters of political 
economy. General view of their commerce. . . • , .69 

CHAPTER VIII. 

Rapid decline of the empire. Its principal causes. First appear- 
ance of Christianity. Influence of Asiatic customs at Constantinople. 
Modification of the civil, religious, industrial and commercial ideas. . 76 

CHAPTER IX. 

Changes brought about in the social economy of Europe through the 
influence of Christianity. Its vigorous and intelligent organiz£iion. 
The monasteries create community life. The religious principle gives 
rise to hospitals and asylums. The priest to-day unequal to his cask. 
Opinion on this subject. . ..,...« 86 

CHAPTER X. 

Economic consequences of the invasion of the Barbarians and the 
dismemberment of the Roman»empire. New elements introduced into 
the social organization. ......... loo 

CHAPTER XI. 

Last rays of civilization at Constantinople under Justinian. This 
emperor sums up all the legislation of the Romans. His Code. The 
Pandects. The Institutes, The laws of Justinian are the archives of 
the past; the Capiiulaties of Charlemagne, the programme of the 
future. ............ 106 

CHAPTER XII. 

Political economy of Charlemagne. Analysis ot the economic part of 
his Capitularies. Singular details contained in the capitulary De 
ViTlis. Social results of the reign of this great man. . . . .116 



CONTENTS. XIX 

CHAPTER XIII. 

PAGE 

The establishment of the feudal reghne and its economic conse- 
quences. The monarchy of Charlemagne dismembered through the 
nfluence of the heredity of the fiefs. General invasion of serfdom. . 124 

CHAPTER XIV. 

The crusades and their influence on the course of political economy 
in Europe. The Saladin tithe. Revolutions in habits. Progress in 
navigation, manufactures and commerce. . '. . . . .133 

CHAPTER XV. 

Considerations on the situation and influence of the Jews in the 
middle ages. Nature of the services they rendered to political economy. 
Were they the first founders of credit? Origin of the bill of exchange 
and of monts-de-pi^te'. .......... 145 

CHAPTER XVI. 

The Hanse tovi^ns. Object of their association. Singular organiza- 
tion of their counting-houses. Importance of the entrepot of Bruges. 
Origin of the Commission-trade. ........ 155 

CHAPTER XVII. 

The aifranchisement of the communes and its influence on the course 
of economic and social progress. . . . . . . . .164 

CHAPTER XVIII. 

The economic legislation of the first kings of France of the third 
race. Ordinances on the Jews. On moneys. Against the exporta- 
tion of coin. The commerce in grain. Sumptuary laws. Oflicial 
origin of our commercial prejudices. . . . . . . .176 

CHAPTER XIX. 

Organization of corporations during the reign of Saint-Louis. The 
Book of Trades, by Etienne Boyleau. General view of the system of , 
corporations. Its former advantages and present disadvantages. . . 189 

CHAPTER XX. * 

The impulse given to political economy by the Italian republics of the 
middle ages. Increasing influence of labor. Increase in personal 
property. Resulting changes in the European social state. Founda- 
tion of credit. Bank of Venice. Origin of the modern prohibitory 
system 208 



XX CONTENTS. 

CHAPTER XXI. 

PAGE 

The revolution brought about by Charles V in the course of political 
economy. The spirit of conquest substituted for the commercial spirit. 
Official establishment of the restrictive system. Slave trade. Finan- 
cial operations. Convents and pauperism. Opposition of protes- 
tantism. ............ 2i8 

CHAPTER XXII. 

The protestant reformation and its influence on the course of political 
economy. Secularization of the inonks. Sale of church property. Its 
importance in England at that period. Poor laws. Increase in number 
of working-days. , . . . . ... . . . 228 

CHAPTER XXIII. 

Consequences of the discovery of the New World, and the colonial 
system of the Europeans in both Indies. ...... 241 

CHAPTER XXIV. 

The various monetary systems which have prevailed in Europe, from 
the ancients to the discovery of the mines of the New World. Eco- 
nomic results of the discovery of these mines. General view of the 
works that have been published on moneys. . . . . 262 

CHAPTER XXV. 

Some bad results from the discovery of the American mines. First 
appearance of paupers in England. Ministry of Sully. His financial 
reforms. His erroneous ideas on manufactures and commerce. He is 
the most ardent propagator of the ?nercantile system. His inclination 
for sumptuary laws. His severe attacks on financial abuses. Defini- 
tive results of his administration. ....... 278 

CHAPER XXVI. 

The ministry of Colbert and its economic consequences. Edict and 
tariff of 1664. Its real aim. Edict of 1667. Encouragements to 
marriage. Fine instructions given to ambassadors. The real doctrines 
of Colbert. H[e is wrongly considered the founder of the prohibitory 
sj'stem. . , ... . . . . . . . . 2gi 

CHAPTER XXVII. 

Political economy under Louis XIV. Commercial ordinances. The 
Marine. Waters and forests. Black code. Councils ol prud'hotnnies. 
Poor-laws. Establishment of asylums for foundlings. . Creation of 
commercial companies. Opinions of the contemporary economists : 
Vauban, Boisguilbert, the Abbe' of Saint-Pierre 304 



CONTENTS. xxi 

, CHAPTER XXVIII. 

PAGE 

Propagation of the mercantile system in Europe, under the name of 
Colbertisvi. It is neutralized by contrabandage. Influence of contra- 
L/ bandage on the solution of economic questions. . j . . . 313 

CHAPTER XXIX. 

The first contest of the mercantile system with freedom of trade, be- 
tween England and Holland. Disastrous effects of that contest. Nav- 
igation Act. Eloquent philippic of M. D'Hauterive against the re- 
strictive system. . . . . . . . . . , .321 

CHAPTER XXX. 

Rise of credit in Europe. Institution of banks. Influence they ex- 
erted on the course of political economy. Banks of deposit and par- 
ticularly that of Amsterdam. Banks of circulation. The Bank of 
England. ........... 332 

CHAPTER XXXI. 

Law's system. The circumstances which gave rise to it. Principal 
causes of its failure. Influence it had on the course of political 
economy. ............ 350 

CHAPTER XXXII. 

The system of Quesnay and the Econoviist school. Origin of its doc- 
trines. Services they rendered. Various shades of the Economist 
school. Gournay. Mercier de la Riviere. Turgot. Admirable 
probity of these philosophers. Details about Quesnay. . . . 365 

CHAPTER XXXIII. 

The ministry of Turgot. Economic reforms he undertakes. Oppo- 
sition he encounters. Influence he exerted on the course of political 
economy. ............ 378 

CHAPTER XXXIV. 

The labors of Adam Smith and their influence on the progress of 
political economy. The differences between his doctrines and those of 
the Economists. Exposition of the creations due to him. His fine 
definitions of value, labor, capital and money. Immense results from 
his discoveries. ... ....... 



391 



CHAPTER XXXV. 

The system of Malthus on population. Exposition of his formulae. 
Presentation of his conclusions. Doctrine of Godwin. It has the fault 



XXll CONTENTS. 

PAGE 

of being as absolute as that of Malthus. It is more humane. RemarW 
able boldness of the book of Godwin. Various writings on the same 
question. New ideas on population, by Mr. Everett. The book on 
Charity, by M. Duchatel. Christian political economy, by M. de Ville- 
neuve-Bargemont. Protests of M. de Sismondi and of the Abbe de la 
Mennais. ............ 408 

CHAPTER XXXVI. 

The influence of the writers of the eighteenth century on the course 
of political economy in Europe. Spirit of the Laws, Economic works 
of J. J. Rousseau. Economic opinions of Voltaire. The Abbe Raynal. 418 

CHAPTER XXXVII. 

Economic doctrines of the French revolution. They have all a social 
rather than industrial character. They are cosmopolitan in theory and 
restrictive in practice. The Convention and the Empire use them as 
weapons of war. General V(iew of the results of the continental 
blockade. It existed in fact before decreed. Fatal prejudices it has 
spread abroad in Europe. . . . . . . ■ . . . 429 

CHAPTER XXXVIII. 

The economic revolution brought about in England by the discov- 
eries of Watt and Arkwright. Economic consequences of the indepen- 
dence of the United States. Reaction of the French Revolution on the 
financial system of England. Increase of taxes. Suspension of pay- 
ments by the bank. Development and abuses of credit. Enormity of 
the public debt. Consequences of the general peace. .... 441 

CHAPTER XXXIX. 

J. B. Say and his doctrines. Important consequences of his theorj' 
of openings for trade. Exposition of the services that writer has ren- 
dered to science. Character of his school. It is that which has popu- 
larized political economy in Europe. ....... 453 

CHAPTER XL. 

Political economy in England since the beginning of the nineteenth 
century. System of Pitt, maintained by Thornton, attacked by Cob- 
bett. Doctrine of Ricardo. Writings of James Mill. Of Mr. Tor- 
rens. Of Mr. McCulloch. Of Mr. Tooke. Labors of Mr. Huskis- 
son. Of Sir Henry Parnell. Treatises of Mr. Wade. Of Mr. Poulett 
Scrope. Economy of Mamifactures, by Babbage. Philosophy of 
Manufactures, by Dr. Ure. Great popularity of political economy in 
England. . , . . . . , . . . . . 46/ 



CONTENTS. xxiii 

CHAPTER XLI. 

PAGE 

The social economists of the French school. New Principles of 
Political Ecotiomy, by M. de Sismondi. New Treatise on Social 
Econony, by M. Dunoyer. Christian Political Economy, by M. de 
Villeneuve-Bargemont. Treatise oft Legislation, by M. Ch. Comte. 
Political Economy, by M. Droz. ........ 484 

CHAPTER XLII. 

Eclectic political economy and its principal representatives. M. 
Storch. M. Ganilh. M. de Laborde. M. Florez Estrada. . . 494 

CHAPTER XLIII. 

Saint Simonian political economy. First writings of Saint Simon. 
Boldness of his attacks. Theory of his disciples. The Producteur. 
What they meant by Industrialism. They found a church. Their 
attacks upon inheritance. General view and estimate of their labors. . 507 

CHAPTER XLIV. 

The Utopian economists. The Societary system of Fourier. Review 
of his principal works. Fundamental idea of his doctrine. Develop- 
ments it appears susceptible of receiving. The social system of Mr. 
Owen. Unsuccessful attempts made by him at New-Lanark and at 
New-Harmony. Sketch of the views of that economist. . . . 520 

CHAPTER XLV. 

General view of the systems in political economy. National char- 
acteristics of the various schools. Italian school. Spanish school. 
French school. English school. German school. . . . -534 

CHAPTER XLVI. 

Economic complications resulting from the industrial affranchisement 
since 1789. Disadvantages of competition. Contradiction between 
facts and laws. Necessity of bringing them in harmony. Revolutions 
which have been brought about in commercial relations since the 
nineteenth century. Resulting modifications in political economy. . 549 



AUTHOR'S INTRODUCTION. 



It may perhaps be well to state here the motive which 
induced me to undertake this work. When called, about 
twelve years ago,* to the chair of History and Political 
Economy which I occupy to-day in the school of com- 
merce, I was not long in perceiving that there existed 
between these two sciences relations so intimate that a 
person could not study the one without the other, nor 
thoroughly understand them separately. They lend each 
other constant support ; the first furnishes the facts ; the 
second explains their causes and deduces the conse- 
quences from them. As I advanced in the exposition of 
doctrines, examples were wanting; and the study of 
events was in its turn incomplete, until political economy 
cast its light upon them. Gradually, while combining 
the labors of my two courses and strengthening them by 
each other, I came upon a multitude of prejudices which 
passed for truths, even among the the best instructed 
and most advanced men. Thus, the authors of all the 
treatises on political economy, without exception, traced 
its origin no farther back than the first attempts of Ques- 
nay and Turgot ; as if never, before the works of these 
celebrated men, had any systematic writing called the 
attention of savants and statesmen td the phenomena of 
the production of wealth. 

*■■ The firsc edition was published in 1837. 



xxvi AUTHOR'S INTRODUCTION. 

From this time, I devoted myself earnestly to researches 
among the historians of all ages for the facts of most 
interest in the study of economic and social questions. I 
had soon found paupers at Rome and at Athens, as there 
are at Paris and at London ; and I must confess that 
privileges, taxes, and iiscal vexations were no more 
rare among the ancients than in our day. Then, as now, 
the least ray of peace and liberty was followed by a 
shower of riches and prosperity ; the same causes, in 
short, produced the same effects, notwithstanding the 
difference of customs and institutions. The distress of 
the people may always be recognized by the inequality of 
the burdens, the vicious distribution of the profits of 
labor, and the prevailing tendency of a few designing 
classes to place abuses under the protection of law. 

But the world did not always remain indifferent, in the 
presence of these social calamities ; and more than once, 
in the course of the centuries, magnanimous protests were 
made in favor of the disregarded rights of humanity. A 
few noble sovereigns aided in these efforts, which were 
sometimes perseveringly followed up, at others interrup- 
ted by the misfortunes of the times. There was, then, a 
political economy among the ancients, as there is among 
the moderns ; not a systematic and formulated political 
economy, but one arising from facts, and practiced before 
being written. Such has been, moreover, the course of 
all sciences since the origin of society. The first comers 
conceive, act, execute ; the later ones reason, and improve 
and complete the work of their predecessors. To well 
appreciate the labors of modern economists, we must then 
become acquainted with the principal phases of the social 
movement which has been going on since the ancients, 
by means of revolutions, and which presents in its pro- 
gress so many sudden and glorious enthusiasms and so 
many dramatic catastrophes. 

It is this movement which I have attempted to trace 
in the work I ofTer to the public. The great states of 



author's introduction. 



xxvu 



antiquity and those of the middle ages did not fail with- 
out a cause ; so great wealth was neither created nor 
destroyed without its creation or its annihilation being 
connected with causes susceptible of analysis and worthy 
of meditation. It is impossible not to recognize the 
finger of Providence in these successive transformations 
of the social principle, which takes refuge now in one 
institution, now in another, without distinction either of 
time or place, as if to hold itself continually at the dispo- 
sition and service of humanity. Here, it is a great man 
who preserves the sacred fire ; in another place a slave 
rekindles it; Sokrates at Athens, Spartacus at Rome. 
From the very depths of barbarism issue the first rays of 
labor and of order; Charlemagne conquered the wave 
which had born him along ; the Hanse towns arose from 
the depths of marshes which served as a retreat for piracy. 

The feudal system, so fatal to the laborers, who were 
enslaved to the land, is full of instruction valtiable to the 
political economist. It was the extreme division of sov- 
ereignty, as we to-day behold the extreme division of 
property. The Roman Empire, momentarily reconstruct- 
ed by Charlemagne, had seen centralization carried to its 
last degree : the feudal system shows us that great political 
power reduced to atoms. On the one hand, we see gigan- 
tic syntheses ; on the other, almost microscopic analyses. 
What a difference must there not be between the poHt- 
ical economy of the chief of forty millions of subjects 
and that of a country squire looking down upon the 
country from the height of his castle keep ! But, from 
hatred of this castle, the bourgeois begin to settle down 
in cities, to organize themselves into brotherhoods, to 
make themselves respected by their numbers. Their 
money is no longer taken from them, it is borrowed from 
them ; and this apparently insignificant fact affords to the 
economist an explanation of an entirely new social order. 

I have followed these great events step by step, and it 
has seemed to me that the political economy of the an- 



XXVlll AUTHOR S INTRODUCTION. 

cients had no other pretensions than that of the moderns. 
In all the revolutions, there have been but two parties 
confronting each other ; that of the people who wish to 
live by their own labor, and that of those who would live 
by the labor of others. These two classes dispute with 
each other the powers and the honors only in order to 
repose in that beatific region where the conquering party 
never lets the conquered sleep in tranquillity. Patricians 
and plebeians^ slaves and freemen, guelphs and gJiibellines, 
red roses and zv/iite roses, cavaliers and round heads, lib- 
erals and serviles, are only varieties of the same species. 
The question that divides them is always that of their 
well-being, each one wishing, if I may be permitted a 
common expression, to draw the coverlid over himself at 
the risk of uncovering his neighbor. So. in one country 
the fruit of his labor is taken from the workman by taxes, 
under pretence of the zvelfare of the state ; in another, 
by privileges, declaring labor a royal concession, and mak- 
ing one pay dearly for the right to devote himself to it. 
The same abuse is reproduced under forms more indirect, 
but not less oppressive, when, by means of custom-duties, 
the state shares with the privileged industries the bene- 
fits of the taxes imposed on non-privileged classes. 

See the Romans in their conquered countries and the 
Spanish in their American colonies : more than a thou- 
sand years apart, you find the same contempt for human 
life, the same abominable paradoxes on the necessity of 
some being worked for the profit of others. This is 
more distressing than what happens among animals, 
where the devouring species live on the devoured without 
at least erecting their voracity into a system, and because 
they cannot do otherwise. All these horrible social in- 
iquities have been propagated for ages, under various 
forms, sometimes tempered by the progress of human 
reason, but always alive at the bottom, and everywhere 
sustained, sometimes with audacity, sometimes with hy- 
pocrisy. At one time, it is the clergy who seize all the 



author's introduction. 



XXIX 



property and deign to give alms to the dispossessed hu- 
man race, threatening with anathema whoever dare trouble 
the repose of the house of God. Farther on, the tithe 
belongs to the lords, because they are lords, and because 
there are no lords without tithes. Peasants are still sold 
in Russia,-'^ like agricultural implements, and the English 
aristocracy haggle with the poor Irish about a few -blades 
of straw and the scanty supply of potatoes which they 
share with the cattle. 

It is not, then, so far as one may think from the Greek 
and Roman political economy, cruel, insatiable, inexor- 
a;ble, to the political economy of more than one country 
in Europe. In our beautiful France, so rich in vines and 
harvests, several millions of men eat no bread, and drink 
only water. Salt abounds under their feet, but the tax 
weighs on their heads, and the gabelleiir, the odious tax- 
gatherer of the middle ages, has only changed his name 
and dress. If one discovers a new plant, tobacco, for ex- 
ample, the law will forbid its cultivation. We may well ex- 
claim with Rousseau : " Everything is good when it comes 
from the hand of the Creator : everything degenerates in 
the hand of man." Those poor girls of Lyons whose fairy 
fingers weave satin and poplin, have no chemises ; the 
canuts who decorate with their magnificent tapestry our 
palaces and our temples, are often without sabots. 

No, this is not the final word of Providence, for of 
those who formerly would have been bound, strugglino- 
for breath, to the soil, not a few live to-day in the bosom 
of opulence, and this number is constantly increasino-. 
There is not an important event of history which does 
not concur in this great result. After the crusades, land 
begins to be divided; maritime commerce opens new 
sources of profit; the arts and manufactures emancipate 
thousands of vassals. Listen to to the sad complaints of 
the people: what do they ask, when they raise their 

* All this is now fortunately changed, though the spirit of tyranny still lin- 
gers as recent events (May, 1879) testify. Ireland, too, breathes a freer 
air than when Blanqui wrote. 



XXX AUTHOR'S INTRODUCTION. 

voices? Reductions of the taxes. What wished those 
wild peasants of the Jacquerie^''' weary of seeing themselves 
decimated by famine, by leprosy, and by despair? A 
more equitable distribution of the profits of labor. They 
were still more modest ; they asked people who did not 
work, to at least let them live from the humblest part of 
the fruit of their toil. The first who had that audacity 
perished under torture, as might have happened at Rome 
if any slave had dared to ask the least right of his master. 

Thus appear to the economist all the struggles whose 
sanguinary details fill the pages of history. It would be 
a great error to suppose that the truly religious thought 
of the general welfare passed unperceived through these 
two thousand years of wars and continued efforts for its 
triumph. We shall see in the course of this work, that 
more than once the cloud which hid it from the eyes of 
people, was dispelled for the best governments, charged 
with the destinies of civilization. Most of these were 
obliged to act in an empirical manner, and without pro- 
claiming their projects, for fear of causing them to 
fail : others obeyed, without suspecting it, the law 
of progress, which led them on in spite of themselves : 
but never has there been a complete dearth of courageous 
men to accelerate this great work ; and I have been more 
than once surprised, in taking a survey of history, at the 
boldness and clearness of their views. 

The Capitularies of Charlemagne, the Institutions of 
Saint Louis, the maxims of the commercial government 
of the Italian republics, are all full of clear and definite 
provisions, having for their aim the development of pub- 
lic wealth, according to the intelligence and the preju- 
dices of the times, to be sure, but with the most generous 
and lofty intentions. In private and public assemblies 
which discussed affairs, remarkable opinions were often 

* An insurrection of the peasantry, which broke out in 1358, when the 
French king was prisoner in England and the country was in a state of 
anarchy. The peasants burned castles, murdered noblemen and committed 
other outrages, doing, they said, as had been done to them. — 7'rans. 



AUTHOR S INTRODUCTION. xxxi 

enunciated ; I have had occasion to quote very curious 
fragments of these scientific opinions. If these produc- 
tions are no longer known, it is because, down to our 
time, readers have preferred the narration of facts to a 
strict analysis of the causes which brought them about. 
Besides, these writings, examined separately, do not seem 
of great importance ; it is only when compared with each 
other and studied methodically, that they truly represent 
the links of a chain of economic doctrines adopted by gov- 
ernments at each memorable epoch, as a rule of conduct. 
Sometimes, when after long discords, the two princi- 
ples of exploitation and of liberty seem near succumbing 
before each other, and make, so to speak, a final summa- 
tion, the social problem appears in all its simplicity, just 
as our fathers laid it down on the famous night of August 
4, 1789; as the insurgent communes of Spain had already 
submitted it to Charles V by Padilla ; * as, in short, it 
tends to become formulated before the Commons of 
England since the reform of 1832. All the theories of 
political economy, then, may be reduced to short maxims 
which clearly sum it up in the view of the people : free- 
dom to work : freedom to have the profits of one's labor. 
The protestant reformation, the insurrection in the 
Netherlands against Philip II, the independence of the 
colonies of North and South America, the civil wars and 
the foreign wars, are only symptoms of this irresistible 
movement which bears humanity along. I have thought 
it better to point out carefully its principal economic 
phases, than to neglect entirely European history and 
make a science as ancient as society commence almost 
with our century. 

Such a course would have been prescribed me by a 
simple feeling of justice, even if the nature of my subject 
had not made it a duty. It is an error to believe that, 
even if we take no account of the systems attempted by 
governments, political economy dates simply from the 
* See Chap. xxi. 



xxxii author's introduction. 

second half of the i8th century. More than two hundred 
years before, Italy had very remarkable treatises on a 
multitude of special subjects which depend upon it. The 
republics of Venice, Genoa, and Florence, knew too 
well how riches are multiplied, not to have left good ex- 
amples to follow and good books to consult. Several 
accounts rendered by their doges and their podestats 
might be placed on a par with the most complete mes- 
sages of American presidents. I have quoted * a dis- 
course of the doge Moncenigo marked by the most 
judicious economic maxims, and a budget of Florence, 
more clear and more circumstantial in its brevity than 
are ours with their indecipherable columns. And the 
system of Law, which our authors affect to reject in the 
heroic times of political economy, what was it, pray, if 
not the uncertain dawn of public and private credit as 
developed in our day? What! Should the fine financial 
reforms of Sully, the bold attempts of Colbert, the fam- 
ous Navigation Act of the English, as well as the revolu- 
tion effected by the crusades, the vast operations of the 
Jews, and the monetary convulsion which followed the 
discovery of the New-World, pass unheeded! 

If the study of the causes which have retarded or de- 
veloped the progress of public wealth were nothing but 
a simple affair of arithmetic, it would not perhaps be 
necessary to go back so far ; I could have counted for 
nothing the advent of Christianity and have limited my- 
self to a simple recital of the fine dissertations of the 
economists on value and utility. But because I think I 
have seen in political economy a science truly social, 
rather than a theory of finance, I have wished to show, 
as far as the vison of man can extend, the providential 
thread which guides nations in the accomplishment of 
their destiny. I firmly believe that some day there will 
be no more pariahs at the banquet of life, and I find the 
source of that hope in the study of history, which shows 

* Chap. XX. 



AUTHOR S INTRODUCTION. xxxiil 

US the generations marching from conquest to conquest 
in the career of civilization. By the progress that has 
been made, I judge of that yet to be ; and when I see 
labor, extricat&d from the Roman galleys, take refuge in 
feudal servitude, then organize into corporations and fly 
across the seas on the wings of commerce, to rest at 
length in the shadow of political liberty, I feel that there 
is in economic science something besides a question of 
words, and I trust I shall be pardoned for having sketched 
in bold outlines the history of its progress through nations 
and ages.* 

The first volume contains such an exposition from the 
time of the ancients to the ministry of Colbert. More 
than once, in tracing it, I have experienced regret for 
having circumscribed my subject within the limits which 
I had imposed upon myself. The materials which I had 
at hand were immense in quantity, for the most part un- 
published, though extracted from works well-known. A 
simple list of them arranged in order would alone form 
an economic monograph extremely curious ; and more 
than one well-informed reader would be very much; 
astonished to find, in these too long-neglected documents,. 
an inexhaustible mine for study and meditation. Such 
facts are not what we ordinarily look for among historians, 
and most of the latter have at all times so well under- 
stood the indifference of the public to facts of this kind,, 
that they have been very quiet about them, and feared 
so much to burden their annals with them, that we are 
obliged to obtain them mostly by induction. Armies and 
courts occupy the foreground ; the human species, that 
which neither kills nor pillages, hardly figures even in the- 
background, and that at a distance so obscure that one 
scarcely knows what became of it for thirty centuries. 

The writers on political economy must be excused for 
having shared in that respect the general indifference, or,, 
if one prefers, the general ingratitude. They almost all 

* In the French editions, the work is divided into two volumes. — Trans, 



^XXIV AUTHOR S INTRODUCTION. 

date from the eighteenth century, because it was then, 
for the first time, that humanity really asked for its ac- 
counts and laid out in clear terms the programme of the 
future. But, in truth, that science did not spring fully 
armed from the brain of the economists during that cen- 
tury. In proof, I should wish but their gropings, their 
disputes, and their unfortunate attempts. It was reserved 
for their successors of the English school to lay the true 
foundations of the economic edifice and to prepare the 
way for the reform which is to be accomplished in our 
day. The history of that period, so rich in productions 
forever celebrated in the annals of science, forms the 
second part of my book. It will be perceived what efforts 
I have had to make to keep from exceeding the limits 
necessary to the unity of my recital. I use this word in- 
tentionally, to justify myself in advance from a reproach 
which I fear to have incurred from some exacting minds. 
I had two routes to take : I could follow the beaten track, 
develop the preliminary discourses of J. B. Say, M. de 
Sismondi, and Mr. McCulloch on the course of political 
economy since Quesnay, adding a few words of politeness 
for the preceding centuries, or I could go further back, 
and connect political economy with general history, 
noting their reciprocal influence from the ancients to our 
day. 

The reader will judge whether this latter course, which 
I have taken, was the better. By placing myself at this 
point of view, I avoided entering into discussions of doc- 
trines, controversies, and in consequence, interminable 
tedious passages. I ran over history at one breath, paus- 
ing simply at epochs of great influence on wealth and 
civilization. I showed labor always finding a refuge, in 
one country or another, and preparing wealth everywhere 
as an aid to liberty. I attempted, in short, to connect 
the present with the past, in place of treating the science 
as a hybrid hatched in the breath of the eighteenth cen- 
tury, prolem sine matre creatam. I wished ancestors for 



AUTHOR'S INTRODUCTION. XXXV 

this fine science, which concerns the welfare of the human 
race and holds in trust the means of procuring for it the 
remedy compatible with the infirmities of our nature and 
the exigencies of our social condition. On seeing how 
slowly reforms come about, and estimating at their just 
value the obstacles they have encountered, the most ar- 
dent reformers of our epoch will learn to moderate their 
impatience and to demand of the times in which we live 
only their concurrent part in the movement which bears 
us along. On this subject, I have told all that our past 
conquests permit us to expect in the near future. I have 
created no system ; I frankly acknowledge that I have 
not in manuscript any plan of universal regeneration and 
prosperity. I have recounted what our ancestors have 
done and what our predecessors have proposed, to re- 
alize the part that can be realized of that generous utopia. 
Some day, doubtless, I shall increase my book, if I obtain 
for this first attempt the sole success of which I am am- 
bitious, that of popularizing economic science by showing 
that its elements are found in the history of nations as 
well as in the writings of economists. 

I have terminated my work by a critical bibliography 
of the most important works on political economy which 
have been published, in all the European languages. This 
catalogue is certainly far from being complete ; but it is 
the most extended which has appeared up to this time, 
and it may serve as a basis for a quite important special 
library.* I have read and made notes on most of the 
writings whose titles I have given and whose subject mat- 
ter I have analyzed, so that the friends of the science may 
know the spirit of an author, before undertaking to read 
his works. It will readily be perceived that this part of 
my work was not the least difficult ; but I hope thereby 
to have reinstated more than one economist who has 
been ignored, and to have made our fellow citizens ac- 

* The bibliography was completed by the editor up to 1859 inclusively, 
in the 4th edition from yhich this is translated. — Trans. 



xxxvi author's introduction. 

quainted with a fruitful source of investigation and in- 
formation. This simple catalogue will alone suffice to 
prove that the science is more ancient than is supposed, 
and that it had already attained its majority when people 
supposed it still in the cradle. I hesitated a moment as 
to whether I should include in my list of names living 
writers, and especially whether I could characterize their 
works with impartiality ; but their absence would have 
had greater disadvantages than the risk my judgment 
makes me inc«ir, and I determined to speak of these con- 
temporaries as if they were dead, while earnestly praying 
that they may yet live a long time. 

One important motive especially influenced my decis- 
ion. The living economists, with a few exceptions, 
form a new school, as far from the Utopias of Ques- 
nay as from the severity of Malthus ; and I see with 
a philosophic and patriotic satisfaction that this school 
originated in France and is composed almost entirely of 
Frenchmen. This school it is which will mark out the 
course of political economy during the nineteenth cen- 
tury. It will consider production no longer as an abstrac- 
tion independent of the fate of the workers : it is not suf- 
ficient for it that wealth be created, but it must be 
equitably distributed. In its view, men are really equal 
before the law as before the Eternal. The poor are not a 
text for declamations, but a portion of the great family, 
worthy of the deepest solicitude. It takes the world as 
it is, and knows how to stop at the limits of the possible ; 
but its mission is to increase daily the circle of guests at 
the legitimate enjoyments of life. I say that this school 
is eminently French, and I am proud of my country that 
it is so. 

May I be permitted, in closing, to render it an homage 
which will be contested by no one, since it comes from 
the simple display of its titles. See the books for 
which we are indebted to it for the past twenty years; 
the Nouveaux Principes d' Economic Politique, by M. Sis- 



author's introduction. xxxvii 

mondi ; the Traite of M. Destutt de Tracy, that coura- 
geous man preeminent for good sense and probity ; the 
excellent book of Duchatel on La Charite ; the Nouveau 
Traits d' Econoviie Sociale, by M. Dunoyer, so deeply 
marked by judgment and philanthropy ; the Traits de 
Legislation, by M. Ch. Comte, which gave the last blow 
to colonial slavery ; L ' Economie Politique Chre'tienne, by 
the viscount of Villeneuve-Bargemont, which has described 
in so new and so remarkable a manner the pest of 
pauperism in ^nxo-^Q-^V Economie Politique oi M. Droz, 
which has made the science an auxiliary to morals, and 
L Essai sur /' Esprit d' Association, by M. Delaborde, to 
which we are fortunate to have recourse to-day, in the 
general disorder of unlimited competition. These works 
have already powerfully modified the rigid theories of 
Malthus and the algebraic formulae of Ricardo. Inde- 
pendent in form and often in the choice of subject, they 
nevertheless are connected by a common thought, Avhich 
is the general welfare of men, without distinction of 
nationality. 

Nor have I been unmindful of the services rendered to 
science and to humanity by the Saint-Simonian school, 
at the time when the good spirit of its founders knew 
how to keep it from the invasion of mysticism and Uto- 
pias. This school has scattered in Europe the germs of 
a reform which is manifesting itself on every side : it has 
recognized the rights of the working class, and defended 
them with a talent and a strength of conviction which 
must have made an impression on even its fiercest ad- 
versaries. The Saint-Simonians often made mistakes, 
like the Economists of the eighteenth century, with whom 
they have more than one point of resemblance ; but 
whatever may be said of their intentions and their mo- 
rality, they were, above all, men of heart and of probity. 
England herself, who railed at them, imitates them; 
and the new works on political economy published in 
that country, are all impregnated with their reformatory 



XXXVlll AUTHORS INTRODUCTION.. 

ideas. It is the Saint-Simonian school which has de- 
scribed most forcibly the sufferings of the laboring classes, 
and if the great problem of the relief of these multitudes 
is not yet solved, it remains at least in the order of the 
day among all civilized peoples. 

It is upon this ground that all questions of political 
economy must henceforth be decided. The true aim of 
the science from this time forward is to call the greatest 
possible number of men to a share in the benefits of civ- 
ilization. The terms division of labor, capital, banks, asso- 
ciation, free trade, have no other signification. Such is, 
at least, the tendency of the modern school, to which I 
have the honor to belong, and under the inspiration of 
which appears the work which I to-day offer the public. 
If some conscientious minds should wonder that I could 
embrace in two volumes the history of a science as im- 
portant and as vast as political economy, I would reply 
to them with one of its most illustrious founders:* "The 
history of a science does not resemble a narration of 
events. It can be only a statement of the more or less 
fortunate attempts that have been made at different times 
and in different places, to ascertain and solidly establish 
the truths of which it is composed. It becomes more 
and more brief as the science grows more nearly perfect." 

* J. B. Sajr, Cours Complet d' Econoitiie Politique, VoL ii. 



HISTORY OF POLITICAL ECONOMY. 



CHAPTER I. 

Political Economy more ancient than supposed. — The Greeks and Romans 
had theirs. — Its resemblance to that of our time. — The differences between 
them. — Successive modifications of the science. — General view of the sub- 
ject. 

A NOBLE Spectacle and one well worthy of meditation, 
is that of the attempts made in the different ages of the 
world, to ameliorate the physical and moral condition of 
man. Each century brings its tribute of fanaticism to 
this grand cause, which counts nations and kings among 
its martyrs. Never does humanity rest : one experiment 
immediately succeeds another, and we advance through 
revolutions toward unknown destinies. 

If we carefully study the history of the past, we per- 
ceive that this movement is of remote origin, that it has 
impelled our fathers and that it is bearing us and our chil- 
dren along with it. Sometimes nations appear to obey 
it blindly, as when Europe was invaded by the barbarians ; 
more frequently they yield to it with a confused sense of 
the eternal laws which direct it. This accounts for the 
innumerable experiments of governments, which experi- 
ments, however, seem constantly to gravitate around a 
few immutable principles, such as personal security and 
respect for property. 



2 HISTORY OF POLITICAL ECONOMY. 

The history of political economy can, then, be only a 
summary of the experiments which have been made among 
civilized nations to improve the lot of mankind. The an- 
cients were not so much inferior to the moderns in that re- 
spect as many writers suppose ; and it is quite wrong to 
attribute to economic science, as people generally do, an 
origin as recent as the second half of the eighteenth century. 
Who does not know of the institutions of Sparta and 
of Athens, and the magnificent works of Roman adminis- 
tration? We could hardly. pass over in silence the econ- 
omy of those times, especially since there we find the 
origin of almost all the institutions which govern us and 
of the systems which divide us. There was certainly in 
the laws of Lykurgus more Saint-Simonism than peo- 
ple think, and the quarrels of patricians and plebeians 
were no more fierce in Paris in the period of terror, than 
they were at Rome during the proscriptions of Sylla, 
The resemblance is still more striking between the insur- 
rection of the worl<men of Lyons and the withdrawal of 
the Roman people to the Sacred Hill.* How many times 
since Menenius Agrippa, has there been occasion to re- 
late to a mutinous populace the famous apologue of the 
stomach and the members ! 

By. excluding from the history of political economy 
everything connected with the ancients, modern econo- 
mists have voluntarily deprived themselves of a fruitful 
source of observations and comparisons. They have re- 
jected two thousand years of experiments tried with the 
greatest boldness, on a vast scale, by the most ingenious 
and most civilized people of antiquity ; they have failed 
to comprehend history, which has carefully gathered up 
the least traces of these very experiments which we are 
to-day again making, too often with less ability and less 

* The author alludes to the insurrection at Lyons in November, 1831, 
which originated simply in a question of wages. The workmen were masters 
of the city for two days ; but their taking arms differed from the withdrawal 
of the Roman people to the Sacred Hill, in not causing any change of their 
condition, as none could be brought about. — Fr. Ed. 



GREEKS AND ROMANS HAD THEIRS. 3 

necessity than the Greeks and Romans. This bias of the 
economists is due to the fact that the ancients left no 
special work summing up their views on economic sci- 
ence ; but if these views were not stated in a book, they 
are found in their institutions, in their monuments, in 
their jurisprudence. The relays of horses, established 
from Rome to York, the especial pains taken by the 
Romans for the maintenance of highways and aqueducts, 
strongly attest their comprehension of the principal ne- 
cessities of civilization. The legislation of the Greek 
colonies was better than that of the Spanish colonies of 
South America. 

Sparta, Athens, and Rome, had their political economy, 
as France and England have theirs. Usury, excessive 
imposts, tariffs, exorbitant charges for collecting the rev- 
enues, insufficient wages, and pauperism, afflicted the 
old communities as well as the new% and our ancestors 
made no fewer efforts than we to get rid of these 
scourges. One would be strangely mistaken to suppose 
that they never reflected on the difficulties in accomplish- 
ing the reforms of which they felt the need. Every page 
of their history presents us proof to the contrary, and 
we doubt not that the great insurrection of slaves under 
Spartacus made the economists of the time pass very 
bad nights. If historians have not acquainted us with 
their anxiety, it is because at Rome no one dared speak 
of that secret pest which was undermining the republic 
and which made the blush mount to the face of its great- 
est citizens. Later, when the emperors decided to dis- 
tribute food to the inhabitants of the eternal city, were 
they not practicing political economy as the monks do 
in Spain at the doors of their monasteries? Is there 
much difference between the maxims of the Athenians 
who prohibited the exportation of figs and those of the 
French who lately prohibited that of silk and rags ? All 
that one can say is, that the Greeks did not find, as we 
do, authors to support these absurdities by sophisms- 



4 HISTORY OF POLITICAL ECONOMY. 

but that does not give us the right to despise them. 

When we study attentively the financial legislation of 
the Greeks and Romans, we can but recognize that the 
most weighty questions of political economy had at all 
times the attention of these nations. It suffices to see 
with what solicitude they guarded their international re- 
lations, the civil status of foreigners, the nature and 
effects of taxes, the encouragements to be given to 
agriculture, and the direction of navigation. I shall have 
occasion in the course of this work to cite irrefutable 
proofs of their perfect apprehension of these matters. 
There was nothing, even to the most complicated phe- 
nomena of the division of labor, which escaped their in- 
vestigation ; and we find in the second book of the Re- 
public of Plato an analysis which would do honor to the 
most learned disciple of Adam Smith. Xenophon's Eco- 
nomics, hitherto insufficiently studied, contain observa- 
tions of great clearness : and we know no better defini- 
tion of money than that which Aristotle has given us in 
the first book of his Politics.* 

One would, however, be mistaken if he considered the 
attempts made by governments, or extolled by the writers 
of Greece and Rome, as the result of an economic system 
conceived according to truly scientific premises, or in- 
spired by a deep philosophy. The Greeks and Romans 
despised labor and stigmatized the industries as beneath 
the dignity of a free man. Slavery appears on every page 
of their history, to give the lie to the writings of their 
philosophers and the theories of their economists. But 
do we not find in our history contradictions as shocking? 
By studying them among the ancients, where we can 
judge them with more impartiality, we can easily recog- 
nize among ourselves the danger or the inutility of a great 
number of experiments which, though appearing new, are 
nevertheless revived from the Greeks and Romans. 

The ancients tried everything; and we resemble them 

* See chapters vi and vii of Aristotle's Politics, Book i. 



ANCIENT AND MODERN CONTRASTED. 5 

in too many respects, to neglect their political economy. 
Sparta had her helots, as the middle ages had their serfs, 
and our colonies their slaves. A few modern states have 
still their disgraced castes, like the Jews in Switzerland, 
Prussia and Poland ; but what principally distinguishes 
the political economy of the moderns from that of the 
ancients, is freedom of labor and the employment of 
credit. Everything around us has changed since the inven- 
tions of printing, the mariner's compass, and gunpowder. 
We know and employ in immense quantities, raw mate- 
rials unknown to our ancestors. Cotton, iron, wines, 
mineral coal and steam, have become for us inexhaustible 
sources of wealth. Three or four plants, the potato, 
beet, sugar-cane and tea, furnish nourishment to millions 
of men, and cargoes to thousands of vessels. The an- 
cients lived by conquest, that is, by the labor of others ; 
we live by industries and commerce, that is, by our own 
labor. 

The distinctive characteristic of Greek and Roman 
political economy, is slavery ; the irresistible tendency of 
ours, is liberty. We shall see how the influence of Chris- 
tianity contributed to give it this direction, interrupted, 
however, sometimes by barbaric invasion, sometimes by 
religious fanaticism ; but no serious obstacle has been 
able to arrest its progress. The feudal glebe had its 
counterpoise in the corporations. These were somewhat 
of an advance, since they developed the spirit of associa- 
tion. Corporations in their turn have disappeared before 
the emancipation of industrial labor. Every step has 
freed man from some bondage and conferred upon him 
some useful product ; so that we may say that liberty 
has never come without bringing with it some benefit. 
The Greeks and Romans who oppressed humanity under 
deceptive appearances, were without underlinen and had 
no windows to their houses ; we ourselves have only just 
begun to enjoy a little comfort in material life since the 
acquisition of liberty. 



6 HISTORY OF POLITICAL ECONOMY. 

To justly appreciate these radical differences, and also 
the resemblances between the political economy of the 
ancients and our own, we must study at the same time 
their institutions and their writings, that is to say, the 
facts and the doctrines of their times. I have chosen for 
that study in Greece, the time of the greatest prosperity of 
Athens, and in Rome, the first centuries of the empire. 
Athens, in fact, best represents Greek civilization, and 
imperial Rome, Roman civilization. The institutions and 
writings of these memorable epochs exercised on the con- 
temporary world an immense influence which has ex- 
tended even to the generation which we represent. The 
Roman laws still decide, in many respects, the most grave 
questions of our civil state, direct our marriages, regulate 
inheritance, and govern our property. Custom-duties ex- 
isted at Rome before the reign of Nero, and the Atheni- 
ans were acquainted with public loans. They knew very 
well the wealth to be gained by commerce : they made 
bottomry loans^, and they at all times gave much attention 
to the exploitation of their mines. In reading their his- 
tory, we might think we were reading ours, so much re- 
semblance is there in the facts, and so true is it that 
humanity moves ever in a sphere of like passions and 
desires ! 

At the fall of the Roman world, a- profound revolution 
is effected in the course of political economy. Slavery 
takes a new form, continually modified by the influence 
of Christianity; ideas of equality begin to be diffused. 
To an affected contempt for riches succeed the first ele- 
ments of the art of acquiring them. A few great sover- 
eigns set the example of order and economy : Charle- 
magne has the eggs of his chickens, and the vegetables 
from his gardens, sold in market. The conquerors be- 
come conservators, and it is easy to find in the Capitu- 
laries ^' the germ of the new ideas which are to take the 
place of the old Roman policy. The crusades later ex- 

* See the Capitulary De Villis, art. 39, edit, of Baluze. 



SUCCESSIVE MODIFICATIONS IN ECONOMIC PRACTICE. 7 

ercise their share of influence, by making the fortune of 
the maritime cities of Italy, which become the refuge of 
civilization from the barbarism of the middle ages. The 
ownership of lands, hitherto concentrated in the hands of 
the lords, is divided by coming into the hands of the 
bourgeois, who purchase them from the crusaders. Con- 
tact with the Orient inspires new tastes, and gives rise to 
desires for luxury which the industry of the Italian re- 
publics hastens to satisfy. There is nothing even in the 
errors of the time, which does not cooperate in the con- 
tinual work of progress, and the persecuted Jews create 
the science of credit and exchange. Saint Louis appears 
and organizes industry. The trades are divided into 
brotherhoods and put under the protection of the saints 
against the tyranny of the barons. The commune is 
formed, and the middle classes {bourgeoisie), from which 
the clergy are recruited, begin that long struggle against 
the aristocracy which hardly ends in the remarkable 
days of 1789. 

Three great events, almost contemporary, the inven^ 
tion of gunpowder, of printing, and the discovery of the 
new world, change, in their turn, the face of Europe 
and the conditions of public wealth. The precious 
metals, previously so rare, become abundant; unknown 
products, as well as ideas, circulate more rapidly ; brute 
force is dethroned by gunpowder. I cannot compre- 
hend how, in the face of these marvellous elements 
of social regeneration, any one could persist in dating 
political economy only from the last years of the 
eighteenth century. It was, however, at that time, that 
pauperism began again with the concentration of for, 
tunes ; then, too, the great schism of protestantism, by 
overturning the convents, struck with slow but sure 
death the principle of tithes and the religious exploi- 
tation of man, which had itself succeeded his military 
exploitation. Who would dare afifirm that these great 
revolutions modified in no manner the economic insti- 
tutions of European nations ? 



8 HISTORY OF POLITICAL ECONOMY. 

Many like events were, without doubt, necessary, to 
determine statesmen and savants to trace them to their 
first causes, the study of which to-day constitutes eco- 
nomic science. Our fathers were for a long time prac- 
ticing political economy, without knowing its principles, 
as most men live without being initiated into the 
physiological phenomena of life. Colbert alone appears 
to have had a system, as later Law was to have his, 
and as the economists of the eighteenth century pro- 
claimed theirs. But these lofty intellects cannot be con- 
sidered as the primitive source from which the science 
came ready made. When we have set forth the ideas of 
Plato, Aristotle and Xenophon, on the questions so ad- 
mirably stated by Adam Smith, and so vigorously con- 
troverted in our day, one can but recognize that these 
geniuses of antiquity had a glimpse of their importance 
and prepared the way for their solution. 

The common error comes especially from the writers 
of the eighteenth century, who thought they had found 
the secret of social science, because they had analyzed 
with a penetration until then unknown, some essential 
phenomena of production. They had opened the way 
for research, in a new and bold manner ; and they passed 
for having created the science, because they had a glimpse 
of it in a prism with many illusions. The services of 
agriculture had been too little understood ; the school of 
Quesnay restored it to the place which it should occupy 
among the agents of production. After him, Adam 
Smith reinstated labor and unveiled the true causes of 
the wealth of nations. Malthus uttered a cry of alarm 
at population, which, according to him, had become too 
numerous ; J. B. Say extolled freedom of trade and the 
advantages of unlimited competition, of which Sismondi 
soon, in an eloquent and paradoxical manifesto, showed 
the fatal consequences. Ricardo laid boldly the founda- 
tions of the modern monetary edifice, which, in his view, 
has been raised only in America, and that for but a moment. 



GENERAL PURPOSE OF THE WORK. 9 

Such are the principal causes of the indifference which 
savants have always manifested toward the study of the 
economic facts of antiquity and of later times remote 
from us. I have thought it would be useful to fill that 
gap, and set forth succinctly and clearly the efforts of our 
predecessors. I shall confine myself to the most charac- 
teristic facts and doctrines of the different periods which 
pass in succession before us. Athens, Rome, the Barbari- 
ans, Christianity, the Crusades, the Renaissance, and the 
Reformation, will present us epochs full of bold experi- 
ments and memorable instruction. Everything is con- 
nected, all forms one chain in the general history of man. 
In view of the strong opposition of intelligent people, now 
manifested in the United States,* to the gradual emanci- 
pation of the blacks, it is impossible not to recall the 
odious maxims of the ancients on slavery, and not to 
recognize, under different names, the same prejudices. 

* Written in 1837. 



CHAPTER II. 

Political Economy among the Greeks. — Their ideas on slavery. — Admin- 
istration of their finances. — They live from the labor of their slaves and 
the tributes of their allies. — What the theorikon was. — The KleruchiEe. — 
Every citizen considers himself a fund-holder of the State. — What a family 
needed in order to live. — Public property. — Mines. — Money. — Temple at 
Delphi a true bank of deposit. — Interest of money in Greece. — Importance 
attached to the finances. — Habits of the Athenians. 

We read in the first book of the Politics of Aristotle * 
these remarkable words : " The science of the master re- 
duces itself to knowing how to make use of his slave. 
He is the master, not because he is the owner of the man, 
but because he makes use of his property. * -^^ * The 
slave constitutes part of the wealth of the family." Xen- 
ophon f proposes, as a means of revenue to the republic, 
to appropriate the slaves and let them out to the highest 
bidder, after having branded them on the forehead lest 
they should escape. All the philanthropy of the ancients 
is found in this, and also a good part of their political 
economy. It is evident that when their philosophers 
speak of the people, they mean simply a domiciliated 
middling class, for whom the masses work, subject to the 
most' intolerable bondage. Their susceptibility is ex- 
treme whenever there is any talk of according to a man 
the title of citizen, that is to say, of making him pass 
from the state of exploitation {i. e., of being worked for 
the advantage of others — Trans,) to that of indepen- 
dence. There was no one, even to the most humble pri- 

* Chap. iv. 

f Means of increasing the revenues of Attika. Chapter xi. 



SLAVERY. THE FINANCES. PUBLIC WORKS. II 

vate citizen, who did not possess one slave to care for his 
house. Heads 6i famiHes of moderate fortune employed 
several in grinding corn, baking bread, cooking and mak- 
ing clothes. Several thousands were employed in the 
workshops for which Athens was renowned ; but gen- 
erally they were subjected to the severest labors. They 
were sent to the river to drink with the horses. 

The institutions of Greece were, then, made for a small 
number of privileged individuals. The Athenians show- 
ed no more sympathy for the sufferings of their slaves. 
than our manufacturers feel for the wheels of their ma- 
chinery. But when we place ourselves at the exclusive 
point of view of this cruel social state, we cannot help 
recognizing in several of its adaptations much ability and 
penetration. The administration of the finances was di- 
rected with remarkable order and exactitude. All the 
regular imposts were farmed out to contractors who paid 
the amount into the public treasury, under the surveil- 
lance of comptrollers. A wise distinction had been es- 
tablished between the public domain properly so called,, 
and the especial property of the communities. The 
avails of the fines adjudged by the tribunals, the reve- 
nues of the temples and of the customs, were turned over 
into the hands of responsible receivers, who took note of 
the sums received and prosecuted the delinquents. A 
superintendent of the public revenues, a virtual minister 
of finance, had direction of all the funds, ordered the 
payments, and balanced the expenditures with the re- 
ceipts. Especial departments were charged with the 
making of the roads, the construction of vessels, and the 
public edifiices. All these departments had their accounts 
and consequently their scribes, the latter being most fre- 
quently chosen from the slaves, as these could be put to 
torture to obtain confessions. Popular distrust was even 
carried so far that no person accountable could go away, 
or make a will, until he had rendered his accounts to the 
public ofifieers appointed to receive them. 



12 HISTORY OF POLITICAL ECONOMY. 

Everything which pertained to the finances was subject 
to pubhc scrutiny. The accounts rendered were engraved 
on stone so that every one could know and criticise them. 
Time has spared us several such inscriptions almost intact 
and even a few stones on which may be found the condi- 
tions of certain contracts, such as the leasing of the salt- 
works, the fisheries and the woods. The devastator of 
Athens, Lord Elgin, brought away one of these stones, 
which is deposited in the British Museum. The people, 
besides, were merciless toward those who betrayed their 
trust or were delinquent in their payments. Nothing was 
more dangerous than to become a public debtor. Ten 
days after a judgment rendered to that effect, arrest for 
debt was ordered : the condemned was forever excluded 
from public affairs ; his children and grand-children be- 
came responsible for his misfortunes or his faults. No 
one could demand abatement, unless the favor of speak- 
ing on that subject was accorded him by an unanimous 
decree of six thousand voices. This extreme suscepti- 
bility in financial matters will not surprise those who are 
acquainted with the social organization of Greek republics. 
At Athens especially, the public treasury was a sort of 
common purse, not only for the collective necessities of 
the population, but also for the expenses of each private 
citizen. Every citizen was a fundholder in the state after 
the establishment of the tJieorikon ^ under Perikles, which 
was a veritable jeto7t de prdsence^ accorded to patriotic 
and garrulous idleness, and which soon degenerated into a 
poor-tax. From that time, the Athenian people wished 
to be fed and entertained at the expense of the public 
treasury. There were periodic banquets, ruinous festivals, 
the originators of which sought popularity at the expense 
of the real prosperity of the country. Hence that passion 
for confiscations and fines which was nearly always mani- 
fest in the popular assemblies, and by- which Sokrates, 
Miltiades, Themistokles, Aristeides, Thrasybulus, Kimon 
and the great Perikles himself were in turn overtaken or 



ATHENIAN DEMOCRACY. ALLIES. 1 3 

menaced. These fines and confiscations were inflicted for 
the greatest crimes as well as the smallest offences. 

The people were mischief-making because they were 
avaricious. They banished honorable citizens on the 
slightest pretext, who then conspired to return to their 
native country, and who more than once desolated it be- 
cause it had not known how to be just. 

The allies were only tributaries on whom taxes were 
levied in consideration of an altogether arbitrary contin- 
gent of soldiers.* Karia, Thrace, the shores of the Helles- 

* Recent labors have vindicated tlie Athenian democracy from a great 
part of the reproaches of historians. Mr. Grote, notably, has positively re- 
futed the calumnious accusations of which the ancient writers on the aristo- 
cratic side were so lavish toward the free institutions of Athens. The con- 
federation of maritime cities which was formed under the auspices of Athens, 
two years after the combat at Mykale, arose spontaneously from the circum- 
stances, and we cannot to-day contest its utility to all Greece and the allied 
cities themselves. The contribution to which the confederated cities had 
pledged themselves, consisted for each in a sum of money and a certain 
number of ships of war ; and according to the acknowledgment of those in- 
terested, it had been regulated in a perfectly equitable manner by Aristeides, 
at the time of the establishment of the confederation. If, thirty years later, 
Athens the president became Athens the despot, to use Mr. Grote's expres- 
sion, it was greatly through the fault of the allies themselves, who preferred 
to convert their payments in men and vessels into pecuniary payments, and 
who proposed to transfer to Athens the treasury of the confederation pre- 
viously lodged at Delos. The total contribution had been fixed by Aristeides, 
in 476 B.C. at 460 talents (less than $500,000); at the commencement of 
the Peloponnesian war, it was still only about 600 talents (about $630,000), 
and that increase certainly did not arise from the increase of the pro- 
portional share imposed on each confederate, but from the admission of 
$630,000), and that increase certainly did not arise from the increase of the 
proportional share imposed on each confederate, but from the admission of 
a great number of new allies and from the conversion of payments in kind 
to payments in money. (Grote, Hist, of Greece, vol. v.) 

At the time when the Peloponnesian war began, the total revenue of 
Athens amounted to about 1,000 talents, 400 of which arose from the receipts 
proper of the city itself and the rest from the contributions of the allies. 
Now, in time of peace, the funds arising from that contribution were not 
expended, but were turned over to the treasury formed by Perikles, and 
amounted at one time to 9,700 talents. " This system of public economy," 
says Grote, " constantly laying by a considerable sum year after year — in 
which Athens stood alone, since none of the Peloponnesian states had any 
public reserve whatever, — goes far of itself to vindicate Perikles from the 
charge of having wasted the public money in mischievous distributions for 
the purpose of obtaining popularity ; and also to exonerate the Athenian 
Demos from that reproach of a greedy appetite for living by the public 
purse, which it is common to ascribe to them." Grote, vol. vi, p. 10. 

It would, moreover, be unjust to consider as unproductive expenses the 
magnificent edifices which Perikles caused to be constructed at Athens, the 
vforks of art with which he adorned the temples, the considerable sums which 
he consecrated to festivals and theatrical entertainments. May we be per- 
mitted again to invoke the authority of Grote on this point : " The schemes 



14 HISTORY OF POLITICAL ECONOMY. 

pont, Ephesus, and the isle of Rhodes, became thus virtu- 
ally Greek fiefs. Aristophanes counted more than a thou- 
sand cities subject to the Hellenic yoke, and he jestingly 
proposed to put twenty Athenian citizens in each of them 
on a pension. Sometimes metropolitan despotism went 
farther, and the Athenians seized, on the slightest pretext, 
a portion of the territory of their allies. The lands thus 
conquered bore the name of Kleruchise. The conquerors 
made them virtual colonies, of which the resident Athe- 
nians composed the aristocracy, always dependent on 
the central government. The father of Plato was a 
klerouch. The citizens whom the state sent to these colo- 
nies usually received arms and money, and they soon 
became odious to the native population there, who more 
than once rose to recover their independence. Every- 
thing was then consistent in the social system of 
the Athenians : they levied contributions at home, they 
levied contributions abroad ; here by confiscations and 
fines, there by war taxes or monopolies. No one dreamed 
of the resources that could be found in labor. The pas- 
sion for the tkeorikojz caused new expedients to be daily 
invented to provide for the living of those exacting 
talkers who were eternally deliberating without ever 
accomplishing anything. 

However, if an exaggerated idea of their superiority 

of Perikles were at the same time eminently Pan-Hellenic. In strengthen- 
ing and ornamenting Athens, in developing the full activity of her citizens, 
in providing temples, religious offerings, works of art, solemn festivals, all 
of surpassing attraction — he intended to exalt her into something greater 
than an imperial city with numerous dependent allies. He wished to make 
her the centre of Grecian feeling, the stimulus of Grecian intellect, and 
the type of strong democratic patriotism combined with full liberty of in- 
dividual taste and aspiration. He wished not merely to retain the adherence 
of the subject states, but to attract the admiration and spontaneous deference 
of independent neighbors, so as to procure for Athens a moral ascendency 
much beyond the range of her direct power. And he succeeded in elevating 
the city to a visible grandeur, which made her appear even much stronger 
than she really was, and which had the farther effect of softening to the 
minds of the subjects the humiliating sense of obedience, while it served as 
a normal school, open to strangers from all quarters, of energetic action even 
under full licence of criticism, of elegant pursuits economically followed, and 
of a love of knowledge without enervation of character." (Vol. vi, p. 24.) 
— Note of French editor. 



SALARIED CLASSES. POOR-TAX. 1$ 

had not turned the Athenians from the regular ways of 
production, they would perhaps have resolved the great 
problem of the most general distribution of the profits 
of labor. All their institutions aimed to make the citi- 
zens participate in the benefits of association ; but they 
excluded from them the slaves, who formed nearly three- 
fourths of the population. The state maintained public 
physicians, (Hippokrates was at Athens), professors, and 
artists charged with beautifying the monuments of 
which each citizen considered himself co-proprietor; the 
offices of notary and of procurator, which have become 
among us sources of exactions so onerous to families, 
were salaried by the state. Instruction was free. The 
chiklren of deceased soldiers received their education at 
the expense of the public treasury, and all orphans found 
in the care of the magistrates a truly paternal protection. 
The reputation of Demosthenes as an orator commenced 
with a suit against his tutors ; and against them he won 
his first case. 

The Athenians had a general principle that no citizen 
should be in want, and they granted help to those whom 
bodily infirmities rendered incapable of providing for 
their own subsistence. But that liberality which they ex- 
ercised toward themselves, soon brought on its natural 
consequences, by multiplying beyond measure the number 
of the idle and improvident ; and when the misfortunes of 
the Peloponnesian war had exhausted the sources of taxa- 
tion, poverty appeared in all its horror. An actual poor-tax 
had to be levied, the uncertain amount of which has been 
discussed by Professor Boeckh with his accustomed clear- 
ness in his excellent work on " The Political Economy of 
the Athenians." * At the same time, the spirit of asso- 
ciation aided them in struggling against the distress of 
the treasury. Several private individuals formed a so- 
ciety called Eranos, with the condition of paying an as- 
sessment, which was distributed according to the neces- 

* Book II., chap. xvii. 



l6 HISTORY OF POLITICAL ECONOMY. 

sities of the members. This society bore the name of 
Community of Eranists, and its head was called an Eran- 
arch. 

It was to these anti-economic habits of living almost al- 
ways at the expense of the public treasury, that the 
Greeks owed the loss of their freedom and the small de- 
velopment of their industrial power. The public distri- 
bution having assumed a periodic character, all the am- 
bitious who were desirous of popularity purchased the 
favor of the multitude by bounties, which exhausted the 
state without enriching those to whom the gifts were 
made. Plato justly remarks that this fatal system had 
rendered the Athenians idle, covetous, intriguing and 
fickle. Perikles, who was the author of it, was by no 
means under an illusion in respect to its disadvantages, 
but he needed it to maintain his power, and so persisted 
in it. Henc^ arose the per|)etual intrigues of the orators, 
whose interest it was to flatter this sovereign with twenty 
thousand heads, called the people, whose avidity could be 
satisfied only by enormous taxes on the rich or by confis- 
cations. Demagogues had come to the point of declar- 
ing in their harangues that if such or such a citizen were 
not condemned, it would be impossible to make up the 
amount of the payments to the people. Those of the 
rich who were threatened, sometimes sacrificed them- 
selves to conjure the storm ; then an extraordinary dis- 
tribution was made and all the malcontents were called 
to the quarry." Thus arose the tkeorika," and Demades 
ventured boldly to declare that the distributions of money 
were the cement of the democracy. Do we not find, 
after a lapse of more than two thousand years, this 
very system of the Greeks revived in the payment of 
forty sous a day, accorded in 1793 to the sectionists' of 
Paris ? 

Everything was calculated among the Greeks to secure 
pay to every class of citizens. The orators had them- 
selves paid for speaking, and the people for hearing" ; the 



COST OF LIVING. 1 7 

judges, trueyV^r/^,* had not allowed themselves to be for- 
gotten either. Whether from policy, or as is more likely, 
to secure positions for popular notabilities, two, three, and 
even ten ambassadors were accredited to each power at 
the same time. Certain public criers, and certain copyists 
of the decrees of the people, were supplied with food at 
the Prytaneum, in which doubtless the state also furnished 
them lodgings. There were physicians and poets main- 
tained at public expense ; in short, the multitude of sal- 
aried persons was so great, that it was necessary to estab- 
lish severe rules against plurality of offices, that leprosy 
of our modern finances. 

It is easy to form an idea of the enormity of the taxes 
which the payment of all these salaries required, when we 
know that the poorest family f could not live on a less in- 
come than 400 francs (less than $80 ) in our money, unless 
they contented themselves with simply bread and water. 
Considerably more was therefore needed to live becom- 
ingly : besides, the piety of the Greeks toward the dead 
made them often incur great expense for funerals and for 
tombs ; they also invested much in furniture, clothing and 
jewels. Most of the good houses contained not only the 
articles necessary for the ordinary purposes of life, but 
also the implements indispensable for the practice of 
several trades, such as weaving and baking, which were 
done at home by the slaves. 

Vanity had led to the luxury of costly vessels of gold 
and silver ; and they increased in number so much, that 
in order to supply those who could pay but little, some 
had to be made of a thickness not exceeding that of the 
skin. Now, if we consider that there were about ten 
thousand houses at Athens, independently of the con- 
structions of the ports, the small towns and villages, and 
about 360,000 slaves, we can form an idea of the accumu- 

* TheyVcr/j, or wardens of trade corporations, were famous for their ex- 
actions of fees from the workmen who aimed at promotion to the poiilion of 
master-workman. 

f Of four person*^, accordins; to Bceckh. 



1 8 HISTORY OF POLITICAL ECONOMY. 

lated wealth in that republic, and by analogy, of the rela- 
tive power of the other Greek republics. 

One however demands with surprise how the Athenians 
succeeded in paying these universal emoluments distribu- 
ted to the various classes of citizens. At the beginning, 
the temples and priests were supported by means of the 
sacred lands, tithes, and sacrifices.* The magistrates of 
the judiciary order received fees. Later, when Solon had 
divided the people into four classes according to the ex- 
tent of their fortune, each class was taxed according the 
taxable capital which it was supposed to enjoy, but, how- 
ever, so that the wealthiest class paid a larger proportion 
of its income than the poorer ones : this mode of taxation 
appears to have had all the characteristics of a quota tax. 
To establish it on an equitable basis, there existed a reg- 
ister of property which was revised every four years. 
This register did not, however, secure the object of our 
records of mortgages. The lender who wished to take 
security, contented himself with putting a tablet on which 
he inscribed his name, before the field of his debtor. 
Besides the quota tax, which alone brought considerable 
sums, and the tributes of the allies, which were a sort of 
war-fine rigorously paid in time of peace, the Athenians 
had the revenues of their mines, the fines, and the avails 
of the confiscations of which we have already spoken, and 
the custom-duties. The state and the communities pos- 
sessed property whose rent brought in a considerable 
amount. This property ordinarily consisted of pasturage, 
forests, houses and salt-works. These were let tempo- 
rarily or permanently to a farmer-general, who pledged 
himself to pay the revenues regularly into the public 
treasury. 

The Greeks, and principally the Athenians, early mani- 
fested their aversion to anything resembling a personal 

* At certain religious festivals, there were sometimes sacrificed at Athene 
as many as three hundred cattle, whose flesh and skin were distributed to 
the people. 



SOURCES OF REVENUE. 



19 



lax, and especially a land-tax. There was not among- 
them any door- and window-tax. Their usual revenue 
came from the public domains and the property of the 
communities. They liked especially to lay taxes on for- 
eigners ; and they had free recourse, even under ordinary 
circumstances, to indirect taxes, imposed, however, with 
great moderation. But they attached especial importance 
to the products of their mines. Those of Attika and 
Laurion appear to have furnished from the earliest times 
considerable treasure, since it was to success in working 
them that Themistokles owed the means of carrying to its 
greatest height the maritime power of the state. These 
mines, however, were not long in becoming exhausted, and 
at the time of Strabo there was hardly enough taken from 
them to cover the expenses of exploitation. It is probable 
too, that the imperfect acquaintance of the ancients with 
chemistry prevented their getting the full advantage of 
them. The work of mining was performed by bands of 
slaves naturally ill-instructed, quite badly disciplined, and 
whose condition bore a close resemblance to that of those 
unhappy Indians with whom the Spaniards worked their 
mines in Mexico and Peru at the commencement of the 
conquest. Nothing, therefore, could equal the despair of 
the Athenians when these resources suddenly failed them, 
and they saw themselves, like the Spaniards of our day, 
reduced to seek in labor, of which they had lost the 
habit, a refuge against poverty and ruin. That change 
must have been the more distressing to them, as the 
mines had been divided up among a greater number of 
proprietors or farmers, hitherto very rich and ranked 
with the most opulent agriculturists and merchants. 

Everything leads us to believe that the ancients shared 
the modern prejudices in regard to the precious metals. 
We shall see in the account of the Economics of Xeno- 
phon that they considered gold and silver as preeminently 
riches, and that it was always an aim in their policy to 
make these metals flow into the national territory by all 



20 HISTORY OF POLITICAL ECONOMY. 

possible means. Consequently they levied on foreign 
merchandise a tax of a fiftieth, which was a custom-duty. 
This impost was to be paid at the time of unlading the 
merchandise, in money and not in commodities, an easy 
operation if one considers that almost all the trade of 
Greece was by sea. There was likewise to be at the gates 
of certain cities a veritable (?^/r^/,^ a source of fraud like 
ours ; for authors report several extremely curious cases 
of smuggling, among others that of a peasant who intro- 
duced casks of honey into sacks of barley, and who was 
discovered by the officers for collecting town-dues, who 
had come to the aid of his fallen donkey. 

Money of gold and silver was quite rare among the 
Greeks before their expeditions to the East. The con- 
quest of a part of Asia by Cyrus caused an immense 
mass of money to flow to the West ; and without doubt 
the fabulous stories of the riches of Kroesus and of the 
Paktolus with its sands of gold, owe their origin to 
facts which the imagination of the Greeks had exag- 
gerated. The great variety of kinds of money imported 
gave rise to the business of money-changers, who specu- 
lated, like those of our day, in the exchange of different 
moneys. 

The Athenians, moreover, practiced a strict surveil- 
lance over the coinage of money, and theirs was of so 
good quality that it was favorably regarded in all markets. 
Although Pliny the naturalist, Strabo, and Diodorus ot 
Sicily, have left us valuable documents on the metallic 
wealth of the ancients, we can but regret the loss of the 
special work that Theophrastus appears to have written 
on the metallurgic art three hundred years before our era, 
and of which there remain a few scattered fragments in 
the works of subsequent writers. That was the source 
of all the documents relating to the money of ancient 
times. 

Philip of Macedon maintained war against the Greeks 
as much with gold as with iron.* Alexander, his son, 

* i. e., the sword. 



GOLD AND SILVER. BANKING. 21 

obtained millions from his expedition into India, and 
distributed with extraordinary liberality among his sol- 
diers. The Ptolemies, his successors, are supposed 
to have collected more than a milliard of francs 
(about $193,000,000) in specie. Silver was, besides, 
rarer than to-day relatively to gold. In the nineteenth 
century, the price of gold is fifteen * times higher than 
that of silver, while in the times of the Greeks it was only 
ten times greater. A billon money, a combination of 
iron and copper, served for the usual intercourse in small 
transactions, but had no currency beyond the frontiers. 

The extreme importance attached to gold and silver, 
gave rise among the Greeks to financial institutions which 
were not without analogy to ours. The temple at Delphi 
received annually, under the protection of Apollo, depos- 
its of considerable sums belonging to private individ- 
uals and even to cities. The priests, interested in seeing 
gold amassed at the foot of their altars, encouraged this 
disposition, and the temple at Delphi became a bank of 
deposit respected throughout Greece. Meanwhile, as 
no interest was obtained for sums deposited there, 
several competitive institutions became established, and 
it was not long before the occupation of banker became 
quite lucrative. The lowest rate of interest appears to 
have been ten per cent and the highest thirty-six. Usury 
took wide limits, on account of the profit that could be 
derived from capital by the aid of slaves, and especially 
because of the little security of the lenders. The same 
phenomenon is reproduced in our time in slave-holding 
countries, as likewise is seen in our colonies, where, besides, 
the formalities of getting possession are so slow, that a 
dishonest debtor can make his creditor die of- the trouble. 
Also, lenders were in the habit of taking out in advance 
the full amount of the interest, which they loaned anew 

* The relative value of gold is now (1879) considerably higher. Whether 
the present relation M'ill continue depends upon causes (production, legisla- 
tion, distribution, commerce, etc.), that cannot be predicted. — Trans. 



22 HISTORY OF POLITICAL ECONOMY. 

on rigorous conditions, braving the public contumely 
mingled with deference and flattery, which was be- 
stowed upon monied men then as in our day. Usury 
appeared again, not less hideous, at Rome and 
throughout all Europe, in the middle ages — a fatal 
symptom of ignorance of the true laws of production,* 
and of contempt of the most simple demands of mor- 
als. One may judge from these facts what must have 
been the rents and farming charges, the rates of which 
were always more or less governed by that of interest for 
money. Professor Boeckh estimates the amount of the 
house-rents at eight and a half per cent on the capital ; 
the rents of lands were a little lower. People built for 
speculation a sort of inn, the apartments of which were 
let to the various strangers whom politics or commerce 
attracted to Athens and who had no right of citizenship 
there. 

It is easy to conceive, from these data, upon what 
onerous terms the public loans must have been effected. 
.The lack of security and the perpetual tendency of these 
people to juridical spoliations, permit a doubt whether a 
single loan of this kind was consented to freely. They 
preferred to have recourse either to augmentations or 
creations of taxes, even on real property, when the neces- 
sities of the state became too pressing. The temple at 
Delphi and that of Delos more than once lent a part of 
the sums which had been entrusted to them. From time 
to time, anticipations of the taxes were decreed, veritable 
forced loans pretty nearly like those of our day, which were 
to be borne by the rich. At last, they went so far as to 
create a fictitious money of iron, which was considered as 
real, by means of which they filled the place of the gold and 
silver exported by foreign commerce, until the iron money 
was bought up and annulled, like our assignats. Then 
came more shameful and deplorable alterations of the 
money, combinations of silver and lead, and of silver and 
copper, the ordinary expedients of governments at bay ; 



FINANCE. DEPENDENCE ON ALLIES. 23 

but these departures were always of short duration, and 
if one excepts Sparta, where the money, for reasons in- 
herent in the constitution of that Utopian repubhc, long 
consisted of heavy and coarse bars of iron, Greece kept 
faithfully the reputation of her monetary system. 

The statesmen of this country always attached great 
importance to matters of finance. It was a difficult sci- 
ence at a time when no public debt permitted loading the 
future with the burdens of the present. The extraordi- 
nary expenses weighing heavily upon the tax-payer, it 
was necessary to engineer in a thousand ways so as not to 
reach capital, and consequently affect production at its 
source. Unfortunately, popular intervention, often little 
enlightened, occasioned serious damage ; monuments of 
art arose in great numbers to satisfy the national vanity; 
the habit of living at the expense of the allies turned 
the citizens from the regular paths of labor. The exis- 
tence of the state depended then on the outside provinces, 
and became consequently very insecure. This is what 
impressed Xenophon when he wrote his treatise on the 
Revenues of Attika, of which we shall soon have occasion 
to speak. 

Such a system must necessarily have exercised a great 
influence on the morals and customs of the inhabitants of 
Greece. The Athenians were inclined to games and ease. 
They were often seen sitting before the porticos of their 
public edifices, arguing on political affairs, discussing the 
news of the day, then, cane in hand, visiting the shops, 
the markets and the public baths. Sometimes they had 
a slave follow them carrying a folding chair which they 
opened to sit upon when they were fatigued. Their re- 
pasts were generally sumptuous, and the bread that was 
sold, even to the most humble workman, was of excellent 
taste and dazzling whiteness. Their markets were fur- 
nished with game, fish, vegetables and fruits of every 
kind. At Sparta, it was quite the contrary ; and yet the 
results of the Lacedaemonian system differ little from 



24 HISTORY OF POLITICAL ECONOMY. 

those of the habits at Athens. The Spartans never rose 
to the height of a civilized nation, because they sought 
to stifle every desire ; and the Athenians quickly de- 
scended from that height, because they were willing at 
whatever cost, to satisfy their desires, and to create also 
new ones every day. 

"If we take a general survey of the whole public econ- 
omy of the Athenians, which the financial systems of the 
other Greeks who enjoyed liberty, Sparta excepted, more 
or less resembled, we recognize that many of its parts were 
judiciously calculated. The Greeks were neither poor 
nor indifferent to wealth ; but the quantity of the precious 
metals in circulation was not as considerable as in the 
states of modern Europe, and consequently many things 
were done with little money. As property gave pretty 
large returns, private citizens could bear high taxes. 
Athens nobly expended large sums for the worship of 
the gods and to perpetuate generous thoughts and great 
deeds by monuments which manifested an exquisite taste 
in the fine arts. But the gratuities and the salaries en- 
gendered love of ease, the people persuaded themselves 
that the state ought to support them, and that their only 
concern was to direct the general administration. It was 
a problem for the public men, to find out how they could 
enrich the people, not by labor and manufactures, but by 
sacrificing to them the revenues of the state ; for the 
commonwealth was regarded as a common property, the 
proceeds of which should be divided among the individual 
citizens." * 

* Boeckh, Public Economy of the Athenians, Book iv. , Chap. 22. 



CHAPTER III. 

Economic Systems attempted or proposed in Greece. — Laws of Lykurgus, 
^-Republic of Plato. — Economics of Xenophon. — Politics of Aristotle. 

We do not think that any country has ever ventured 
upon a system of public economy as extraordinary as the 
laws of Lykurgus at Sparta. The strictest regulations of 
a community, the most radical forms decreed by the Na- 
tional Convention, the harmonic Utopias of the Owenists, 
and, in these later times, the adventurous preaching of 
Saint-Simonism,have nothing which can be compared with 
those laws, in point of boldness and originality. They 
seem the dream of a contemplator rather than the result 
of the meditations of a statesman, and yet they had quite 
a long existence, and penetrated deeply enough into the 
morals of a celebrated people, to occupy a place in the 
history of the science. The principal characteristic which 
distinguishes them, is their having been, so to speak, im- 
provised and applied at once in the government of a 
people who had until then laws very difTerent. In read- 
ing them, one seems to be looking over the rules of a col- 
lege rather than the code of a nation. Everything there 
is so singular, that the existence even of their author has 
been doubted by many savants, who are persuaded that 
there was more than one Lykurgus, as it was long thought 
there was more than one Homer. 

Still, whatever may have been the origin of the laws of 

Lykurgus there is abundant evidence that they directed 

for many centuries, more or less intact, the destinies of 

25 



26 HISTORY OF POLITICAL ECONOMY. 

the Spartans. They pass for having realized the utopia 
of a general division of property, and of a common edu- 
cation for all citizens. They embrace at the same time 
a complete system of political economy, a catechism of 
beliefs, and a universal manual for the industrial arts. 
They regulated the order of succession to the throne, and 
that of dishes at repasts. What could be stranger than 
the division of the territory of Sparta into nine thousand 
portions, and the rest of the country into thirty thousand 
other parts, assigned to so many fathers of families, on 
condition of distributing their products to their wives 
and children ? How could that temporary equality of 
fortunes last ? I acknowledge that I can hardly compre- 
hend a society in which it is forbidden to buy or sell any 
portion of land, or to bequeath it by will. How can that 
prohibition be reconciled with the right of primogeniture 
which existed at Sparta, unless we suppose that the eldest 
of each family was obliged to maintain his brothers, and 
then what became of equality, that imaginary aim of the 
laws of Lykurgus? 

It was not permitted to settle a dowry upon girls ; but 
men probably wedded them without any uneasiness in 
regard to the future, since the state assumed the burden 
of bringing up and providing for the children they brought 
into the world. Happy country ! where each citizen had 
only to seat himself at table, sure of finding there a 
repast, provided he brought his contingent of barley or 
vegetables ! Most wonderful of all, there were neither 
imposts nor a public treasury : and yet, if we credit Aris- 
totle, this philosophical people sometimes found means of 
lending money. Aristotle assures us that when the depu- 
ties of Samos applied to their treasury, the general as- 
sembly ordered a universal fast of twenty-four hours, 
men and animals included, to obtain a little saving to be- 
stow upon the allies. But since it was forbidden to buy 
or sell, of what use was money at Sparta ? Notwith- 
standing our respect for antiquity, I greatly fear that 



PROPERTY. EDUCATION OF CHILDREN. 27 

these and many other stories of loans are mere fabrica- 
tions. What is certain, however, is that there was a time 
in Sparta when the sense of property seemed to have be- 
come extinct, and to have given place to a patriotic uncon- 
cern founded on an entire absence of personal wants ; 
for the legislation of Lykurgus was perfectly consistent. 
By destroying the foundations of property, it made per- 
sistent war on the desire for acquisition, and consequently 
on all the tastes which inflame it. 

This was, in fact, what the legislator had in view. All 
the children, withdrawn from maternal influence at the 
tenderest age, ceased to belong to their families and be- 
came the property of the state. Whatever their parent- 
age, they were brought up in common, according to in- 
variable principles, under the surveillance of the magis- 
trates, and almost on the public place. The whip was 
decreed preeminently the institution. Children were de- 
spoiled of their hair in the interest of neatness; they 
walked barefooted at all seasons ; they lay down to rest 
on a litter of dried leaves. They were taught to steal 
fruit for their repasts, and whipped when they allowed 
themselves to be detected. When they reached adoles- 
cence, a new apprenticeship began for them, that of war, 
and they practiced its exercises with such boldness, that 
blood flowed in those disgusting arenas, where, half-naked, 
they tore each other under the eyes of their mothers. 
" You bite me, like a woman," said one.. " No, but like 
a lion," replied the other ; and the spectators applauded 
these furious youths making free use of their nails and 
their teeth. What detestable people! and what name 
should we give to such virtues ! 

The education of the women presented anomalies no 
less shocking, and our reason refuses to admit the pre- 
tended moral efficacy of the system adopted in regard to 
them. An intelligent critic has justly said that they were 
considered at Sparta rather as females than as compan- 
ions of man. They were esteemed only according to the 



28 HISTORY OF POLITICAL ECONOMY. 

strength of their bodies and the vigor of their constitu- 
tion. They were early put to practice in handling the 
javelin and running almost nude in the arena, in the pres- 
ence of all the citizens and even of young men of their own 
age. Shall I speak of the infamous custom of substituting 
paramours for husbands, in a multitude of circumstances 
legally provided for? Must we recall the incestuous 
unions and the breeding combinations which led these 
gross people to promiscuity of the sexes, under pretext of 
improving the race and strengthening the offspring? I am 
not surprised that time destroyed the monuments of 
Sparta, if ever Sparta had monuments. We read in Plu- 
tarch that the houses of the Lacedaemonians were very small 
and constructed without art. The doors were wrought 
with no other tool than the saw, and the floors with only 
the axe ; trunks of trees "scarcely stripped of their bark 
served for beams ; — habitations quite worthy of such a 
people, and which seem to belong rather to nomad tribes 
than to a civilized nationc Had they not a horror of fine 
language, of the sciences, which they called vices, and of 
everything which constitutes the glory or the charm of 
life ? Even in their theatres, they preferred boxers to 
poets : that tells all. 

It is not surprising that the industrial arts have little 
place in their history. What art was necessary for peo- 
ple who lived on black broth, who used badly-hewn blocks 
of wood for seats, who generally walked with head and 
feet bare! The few artisans that were seen in Sparta, 
pursued, as in Egypt, the trade of their fathers, and most 
of the inhabitants followed none. These men, so different 
from the Athenians in everything else, resembled them 
completely in their horror of manual labor. Labor was 
to them a symbol of slavery, — a deplorable error which 
ruined ancient civilization, and which to-day keeps in a 
state bordering on decay, our young republics of South 
America. Woe to the nations that commit to slaves the 
care of providing for their needs, and to such hands en* 



PLATO ON DIVISION OF LABOR. 29 

trust national production ! Between the helots of Sparta 
and the negroes of the European colonies, where is the 
difference ? and what difference, moreover, is there be- 
tween the Spartans driving out the helots and the 
Spaniards driving away the Indians ! The end of each of 
these dominations was the same, for brute force can 
indeed conquer, but it belongs only to true liberty to 
conserve and to civilize. 

Still, the institutions of Sparta have excited to the 
highest degree the admiration of the ancients and the 
moderns. Aristotle, Plato, and Xenophon have left us 
vivid and animated pictures of them. But ought not 
these representations to be considered as works of imagi- 
nation, rather than as serious scientific treatises ? Should 
we not see in them a philosophical thesis, instead of eco- 
nomic doctrine? I cannot quite bring myself to that 
opinion. The institutions of Greece did not spring from 
chance ; most of them were the result of the study of 
many celebrated men, who prosecuted their development 
with a quite systematic inflexibility of logic. One might 
say that they wished to see the end of their experiments, 
as with us the executive power insists on the enforcement 
of the laws which its initiative has caused to be enacted. 
When Plato wrote the dialogues which compose his Trea- 
tise on the Republic, he proved quite clearly that political 
economy, such as we understand it to-day, was not foreign 
to his most enlightened contemporaries. He pointed out 
the advantages of division of labor with a lucidity so per- 
fect that it seems to us to take from Adam Smith the 
merit of that discovery, if not the priority of the demon- 
stration. We will quote just here the most curious pas- 
sages of that dialogue, so natural, so true, and so admir- 
able for precision and simplicity.* 

" What gives rise to society, is our powerlessness to 
provide for our own needs, and the desires we have for a 
great number of things. Thus, necessity having led one 

* Republic of Plato, Book II. 



30 HISTORY OF POLITICAL ECONOMY. 

man to unite with another, society is formed to the end of 
mutual assistance." — " Yes ; but one gives another what 
he has, to receive what he has not, only because he thinks 
it for his advantage to do so." — " Certainly." — " Let us 
then build a city in thought. Our necessities will form 
it. Is not the first and greatest of all, food?" — "Yes." 
— " The second need is shelter, the third, clothing." — 
" Undoubtedly." — " How will our city meet these wants? 
Will it not be necessary to that end, that one be a farmer, 
another, an architect, another a weaver? Shall we add a 
shoemaker or some similar workman ?" — "Certainly" — 

Every city is then composed of many persons ; but is it 
necessary, that each one of the inhabitants labor for all 
the others ; that the farmer, for example, raise food for 
four and take four times as much time and trouble, or 
would it not be better that, without concerning himself 
with the others, he should employ the fourth part of the 
time in preparing his own food, and the three other parts 
in building himself a house, making his clothes and his 
shoes?" — " It seems to me that the first way would be 
more convenient for him. In fact, we are not all born 
with the same talents, and every one manifests particular 
inclinations. Things would then go better, if every man 
confined himself to one trade, because the task is better 
and more easily accomplished when it is adapted to the 
tastes of the individual and he is free from every other 
care." 

Surely the advantages of division of labor have never 
been more clearly defined than in this remarkable pas- 
sage. We shall soon see how ingeniously the author 
will be led to a definition of money. " Just see," re- 
sumes one of the interlocutors of Plato, " the carpenters, 
the blacksmiths and the other workmen, who are going 
to enter our little city to increase it. It will be al- 
most impossible, henceforth, to find a place from which 
it can draw everything necessary to its subsistence." — 
'* The city will need people to go out in the vicinity to 



INDUSTRIAL DEVELOPMENT. 3 1 

seek for what it lacks." — " But these persons will return 
without having received anything, if they do not carry 

to the neighbors something to satisfy their wants." 

"Assuredly, and people must be found who will take 
upon themselves the charge of importing and exporting 
commodities. These are called traders." — " Yes, and 
besides, if the trade is carried on by sea, another set of 
people will be needed for navigation purposes." — " But, 
in the city, how will our citizens distribute the results of 
their labor ? " — " It is evident that it will be by sale and 
purchase." — " Then we need a market, too, and a money, 
symbol of the contract." 

Might not one think, in reading these lines so simple 
and so terse, that he was looking over one of our best 
treatises on political economy ? It would, in fact, be 
difficult to explain more clearly the natural progress of 
industrial development in a city at its commencement. 
In proportion as that imaginary city increases in wealth, 
its situation becomes complicated : the distribution of its 
riches takes place unequally, and often raises many ques- 
tions not easy to resolve. " What ruins artisans ? " says 
Adimantus. And Sokrates replies : " Opulence and 
poverty."—" How is that ? "— " In this way. Will the 
potter who has become rich trouble himself much about 
his trade ? "— " No."—'' He will daily become more idle 
and neghgent ?"—" Doubtless."— " And consequently a 
worse potter ? "— " Yes."—" On the other hand, if pov- 
erty takes from him the means of providing himself with 
tools and with everything necessary to his art, his labor 
will suffer from it; his children and the workmen whom 

he is training will be less skilful on that account." 

" That is true." — " Thus wealth and poverty are equally 
injurious to the arts and to those who practice them."— 
" So it appears."—" Then there are two things to which 
our magistrates will be careful not to give admission into 
our city, opulence and poverty: opulence, because it en- 
genders effeminacy and idleness ; poverty, because it pro- 



32 HISTORY OF POLITICAL ECONOMY. 

duces baseness and envy : both because they lead a state 
to revolution." 

We can but recognize here the perfect competency 
of the ancients to examine the most serious ques- 
tions of political economy. After more than two thou- 
sand years, we have not yet obtained the realization 
of the Utopia of Plato, of that just economic middle 
securing to each an equal share of the profits of labor. 
We have still rich potters who neglect their art, and poor 
workmen to whom the tools must be furnished which 
they are not in a condition to procure for themselves. 
People have then long been thinking on these terrible 
problems of the social state, which revolutions continu- 
ally touch upon without ever resolving ! Dictatorship, 
slavery, liberty, pillage, association, aristocracy, democ- 
racy, everything has been exhausted in the attempt: the 
enigma remains still inexplicable. Happy our genera- 
tion, if science some day gives it the key ! 

After having so ingeniously defined the city and ana- 
lyzed the division of labor, Plato stops all at once and 
advises a common possession of the women and children. 
" I propose," he says, " that the wives of our warriors be 
comtnon to all; that no one of them live solely with any 
particular one ; that the children be common, and that the 
latter should not know their parents, nor the parents their 
children." * I quote literally this astonishing passage, to 
give an idea of the degree of boldness to which the spirit 
of system could lead one of the finest geniuses of anti- 
quity. Community of property, another chimera, was also 
considered by Plato as a sovereign remedy for the most 
inveterate diseases of society. There would no longer be 
troubles, nor disorders, nor insolence, nor servility. Usury 
would disappear with avarice and the vices that an immod- 
erate love of wealth multiplies among men. No more 
lawsuits, hence no more chicanery ; we should all live as 
brothers. " We cannot, however," adds Plato, " hope to 

* Republic, Book V. 



PLATO AND XENOPHON ON MANUAL LABOR. 33 

realize the plan of this perfect republic. As skilful paint- 
ers delineate in bold outlines models of an ideal beauty, 
impossible to find in individuals, so we only attempt to 
present a finished type. The more the legislators ap- 
proach this model, the more suitable will their constitu- 
tion be to lead men to happiness." Such was the opin- 
ion that Plato himself had of his doctrines, a remarkable 
mingling of observations full of correctness and of Uto- 
pias unworthy of attention. One can hardly reconcile, 
m fact, the dreams of equality which agitate this philoso- 
pher, with his profound contempt for the laboring classes. 
" Nature," according to him, " made neither shoemakers 
nor blacksmiths ; such occupations degrade the people 
who engage in them, base mercenaries, nameless wretches, 
who are excluded, by their very condition, from political 
rights. As to tradesmen, accustomed to lie and deceive, 
they will be suffered in the city only as a necessary evil. 
The citizen who shall degrade himself by shop-keeping, 
will be prosecuted for this offence. If convicted, he will 
be condemned to a year's imprisonment. The punish- 
ment will be doubled at each repetition of the offence. 
This sort of traffic will only be permitted to those among 
foreigners who shall be found least corrupt. The magis- 
trate will keep an exact register of their bills of goods and 
of their sales. They will be allowed to make only a very 
small profit." * Xenophon is not less explicit. He thinks 
" the manual arts are infamous and unworthy of a citi- 
zen. Most of them deform the body. They oblige one 
to sit down under shelter or near the fire. They leave 
time neither for the republic nor for one's friends." 

It is this doctrine of men of leisure^ resurrected among 
us, which sums up all the political economy of the an- 
cients. M. de Sismondi very sensibly observes f that 
they at least always recognized that wealth had no value 
save as it contributed to the general happiness, and 

* Plato. Treatise on the Laws. Book XL 

f Nouveaux Principes d' Economie Politique. Book I, chap. ii> 



34 HISTORY OF POLITICAL ECONOMY. 

that it was on account of not having considered it ab- 
stractly that they often had on that subject ideas more 
just than ours. The political economy of the Greeks was 
eminently governmental and reglementary. Their writers 
desire the law to concern itself with everything and leave 
almost nothing to the individual freedom of the citizens. 
The city is to them only a vast association, where every 
inhabitant plays an allotted part, or rather a grand ma- 
chine of which he represents one of the parts. They 
concern themselves exclusively with the masses and ne- 
glect the individual — a dangerous abuse, in comparison 
with which there is nothing more dangerous except the 
contrary abuse, into which in our day the great nations 
civilized by industry appear to fall. And yet we must 
not forget that when they speak of the masses at Athens, 
they are only talking of that small number of free men who 
are supported by hosts of slaves. In this sense, Mr. Du- 
noyer was right to say * that the slavery of the useful oc- 
cupations had been the economic regime of every newly- 
established society. Rousseau claimed that this regime 
was indispensable, " because there are unfortunate posi- 
tions where one can keep his liberty only at the expense 
of that of another, and where the citizen cannot be per- 
fectly free unless the slave is entirely a slave. " f This sin- 
gular doctrine proves how far the finest geniuses will go 
astray in blind admiration for the institutions of antiquity ; 
but we to-day should not err with them. A more philo- 
sophical study of ancient history shows us the Greeks a 
prey to civil dissensions, to foreign war, and to the in- 
trigues of public life, in consequence of the lack of em- 
ployment in which the labor of slaves permitted them to 
live. They excelled in driving chariots in the race-course, 
quibbling over grammatical subtilties, and making bad 
music ; and, having become rhetoricians after having been 
pillagers, they succumbed for lack of courage to defend 

* Nouveau TraitS d" Economic Sociak. Vol. I, p. 234. 
+ Contrat Social. Book III. 



xenophon's "economics." 35 

themselves and lack of money for mercenaries to de- 
fend them. 

The political economy of Xenophon rests on no dif- 
ferent bases from that of Plato. Whenever there is any 
attempt to analyze the operations of labor, to go back 
to the source of revenue, and to determine the utility ol 
things, the clearness of that writer is remarkable ; but as 
soon as there is a question of division of profits, Greek 
prejudices resume their sway, and the author falls back 
into the politics of Plato and of Aristotle, those faithful 
interpreters of contemporary oligarchy. What a pity that 
these men, so clever in explaining the essential phenom- 
ena of production, did not more judiciously deduce the 
consequences of them. Listen to Xenophon in his defi- 
nitions : " We must understand by wealth only that which 
can be useful to us. The lands we cultivate are no longer 
wealth, when we lose by their cultivation. Money even 
is not wealth, if no use is made of it." J. B. Say has not 
given a better definition of productive and unproductive 
capital. The Greek author elsewhere utters these re- 
markable words: " One has very long arms, when he has 
those of an entire people!' He proposes to grant gratuities 
to those of the merchants' tribunal who should most 
speedily and with most justice terminate cases ; but he 
seems to us less fortunate when he maintains that a great 
abundance of money will not make it lower in value. Be- 
sides, the writings of Xenophon, though abounding in 
intelligent advice to agriculturists and in considerations 
very important to philosophers, cannot give us a complete 
idea of the true economic views of the ancients. The 
author has confined himself to recommending temperance, 
activity and a good distribution of labor. He has carC' 
fully traced the spheres of man and woman under the in- 
fluence of marriage, the advantages of order, of emula- 
tion and of rewards. Finally, he has energetically mani* 
fested the profound contempt which manual labors inspire 
in him. " The people who devote themselves to them." 



36 HISTORY OF POLITICAL ECONOMY. 

he says, " are never elevated to responsible positions, and 
it is rightly thus. Most of them being obliged to sit all 
day, and some even to experience the continual heat of a 
fire, they cannot fail of having the body injured, and it 
could hardly be otherwise than that the mind should feel 
the effects of it. Besides, the labor consumes all the 
time ; one can do nothing either for his friends or for the 
state." 

Such is the forced conclusion of all the economic the- 
ories of the ancients. One cannot conceive, while reading 
these vehement philippics against the working class, that 
the great authors of them deigned to write such fine things 
as they did in favor of these very workers whom they 
overwhelm at every opportunity with their sarcasms and 
contempt. Agriculture alone, in the eyes of the ancients, 
passed for a respectable branch of industry ; for it alone 
they reserved their care and their admiration. Xenophon 
consecrates to it the most important part of his Economics. 
He there treats of the means of forming good farmers, of 
becoming acquainted with the properties of the soil, of 
the times favorable for work, of seeds, planting, clearing 
lands, and of trade in grain ; but so briefly, and in a man- 
ner so sentimental, that his book, notwithstanding the ex- 
cellent data it gives, more resembles an elementary book 
of morals than a scientific treatise. However, one finds 
there with interest the usual prejudices of the ancients on 
certain important questions of science, notably, in favor 
of the precious metals. " Silver," says Xenophon, " does 
not resemble the other productions of the earth. Let 
iron or copper become common, to such a point that works 
of these materials sell too cheap, and the workmen are 
completely ruined. The same is true of agriculturists, in 
years when wheat, wine, or fruits are very abundant. 
With silver, it is quite the contrary. The more mines 
are found and the more they are worked, the more we see 
citizens eager to possess them. * * * In case of war, 
silver is also necessary to support the troops and to pay 



ARISTOTLE'S "POLITICS." 37 

the allies. It will perhaps be objected that gold is at 
least as useful as silver. I shall not maintain the con- 
trary. I will simply remark that if gold should become 
more common than silver, the latter would rise in value, 
and gold would itself fall." * 

Thus, in these governments of Greece, so often quoted 
as models of patriotism, war was made only with silver, 
and defenders and allies were found only for such pay. 
And how could it have been otherwise ? The rich class 
was alone invested with the privilege of the city ; they 
were incessantly occupied with political intrigues and 
were obliged to confide to mercenaries the honor of pro- 
tecting the national independence. A day came when 
the laws of Lyk'irgus and those of Solon had a common 
destiny. The portions that these legislators thought 
they had secured to each citizen in the property of the 
territory, were finally absorbed by a few ambitious men ; 
and, when external dangers suddenly burst upon them, 
no one would defend a country which had become the 
property of a few families. 

This fatal crisis appears still more inevitable if we read 
the economic treatises of Aristotle. In truth, these writ- 
ings belong much more to politics than to political econ- 
omy ; but they explain the economic doctrines of the 
Greeks so clearly and systematically that they should be 
considered the most valuable monument of their history. 
The Politics of Aristotle is divided into eight books. In 
these he examines in succession the elements of the for- 
mation of societies, the qualities which distinguish a good 
citizen, the various forms of government, the causes of 
revolutions, and the bases on which all good legislation 
should rest. Nothing is more singular than the reasoning 
by which this ingenious publicist has sought to justify 
slavery as an institution of natural law. " It is Nature her- 
self," he says,f " who has created slavery. Animals are 

* Means of Increasing the Revenues of Attika, chap, ix. 
I Politics. Book iii, chap. i. 



38 HISTORY OF POLITICAL ECONOMY. 

divided into males and females. The male is more per- 
fect ; he commands. The female is less complete ; she 
obeys. Now, there are in the human race individuals 
as inferior to others as the body is to the soul, or as the 
beast is to man ; these are beings suitable for labors of 
the body alone, and incapable of doing anything more per- 
fect. These individuals are destined by nature to slavery, 
because there is nothing better for them than to obey. 
* * * Does ehere then exist, after all, so great a dif- 
ference between the slave and the beast ? Their services 
resemble each other ; it is by the body alone that they 
are useful to us. Let us then conclude from these prin- 
ciples that nature creates some men for liberty and others 
for slavery ; that it is useful and just that the slave should 
obey." 

After having proclaimed the strange principles on which 
the whole structure of his politics rests, Aristotle exam- 
ines under the name of speculation the theory of wealth, 
of which he would make a science by itself, and proposes 
to call it chrematistics. M. de Sismondi has appeared to 
attach much importance to the adoption of that exclusive 
name, which would tend to nothing less than to limit po- 
litical economy to the simple elements of the production 
of wealth. But the efforts of the learned professor of 
Geneva have not succeeded in imposing on modern econ- 
omists that subtilty of the philosopher of Stageira. 
There is something for us besides the study of material 
production in the science whose history I undertake to 
write ; all the world agrees in finding in it the means of 
ameliorating the fate of the human race ; and the book 
of Aristotle presents incontestable proof of it. Why 
should he have joined to his bold attempts at social or- 
ganization everything that concerns the science of wealth 
if he did not consider these great questions inseparable ?, 
And would that he had been as happy in the former as 
he showed himself enlightened in the latter ! 

Scarcely has he explained wherein consists the wealth 



ARISTOTLE ON MONEY. 39 

that he calls natural, when he devotes himself to that 
which he calls artificial. " Every article of property," he 
says,* " has two uses, both inherent in the article. One 
is the natural use, the other the artificial use. Thus the 
natural use of covering for the feet is for aid in walking ; 
its industrial use is to be an object of exchange." Might 
not one think he was reading the definition of value in 
use and value in exchange, popularized by Adam Smith, 
and become in our day the basis of all the treatises on 
political economy? 

Aristotle has set forth not less truly and clearly the ad- 
vantages of mdney. After having cast a glance over the 
different kinds of trade, he explains very well how nec- 
essity gave rise to the invention of money. " People 
agreed," he adds, " to give and receive in transactions a 
useful material of easy circulation. They adopted for 
this use iron, silver and other metals. This first symbol 
of exchange was valued at the beginning only according 
to its volume and weight ; afterwards it was stamped with 
a mark which denoted the value, in order to dispense with 
any other verification. After the necessary adoption of 
money for exchanges, a revolution took place in the man- 
ner of speculating ; trafific appeared. Its beginning was 
perhaps quite simple. Soon it found out more clever 
combinations, in order to derive the greatest possible 
benefit from the exchanges. Hence it happened that 
people became accustomed to restrict the art of specula- 
tion to money alone; they thought the only function of 
the speculator was to amass the precious metals, because 
the definite result of his operations was to procure gold 
and riches. Nevertheless, is not money an imaginary 
wealth ? Its value is wholly in the law. Where is that 
which it has from nature? If the opinion which admits it 
into circulation changes, where is its real value ? What ne- 
cessity of life could it relieve ? By the side of a heap of 
gold, one might lack the most indispensable food. What' 

* Politics. Book i, chap. vi. 



40 HISTORY OF POLITICAL ECONOMY. 

folly to call riches an abundance in the midst of which 
one dies of hunger !" 

It is impossible to characterize more justly the true 
properties of money. Elsewhere Aristotle has estimated 
with the same accuracy the consequences of usury and of 
a spirit of monopoly. " A Sicilian," he says, " had a sum 
of money in store. He bought with it all the iron there 
was at the forges. Soon merchants arrived from differ- 
ent countries, and found iron only with him. He had not 
raised the price too high ; however he doubled his invest- 
ment, which was fifty talents." 

Several modern economists have with some reason been 
reproached for having included in their estimates of the 
contributors to public wealth only the material producers, 
as if the magistrate who dispenses justice or directs the 
administration did not render to society as many services 
as the artisans or the agriculturists. Plato himself fell 
into that error, which is earnestly refuted by Aristotle : 
" Ah ! indeed ! Is the city only established for physical 
wants ? Will farmers and shoemakers supply every want ? 
What is the part of man which constitutes his essence ? 
It is the soul rather than the body. Why then should 
the occupations which provide only for the prime neces- 
sities compose a city, rather than the occupation of im- 
partial arbiter of rights, or that of a senator deliberating 
for the good of the state ? Are not these occupations 
the very soul of the city ? " * Thus had Aristotle, long 
before J. B. Say, reinstated these creators of immaterial 
products, the classing of whom has passed for a discov- 
ery of our time. He had also indicated with admirable 
precision the causes of the old struggle which has existed 
between wealth and poverty, from the earliest ages of the 
world. " Every political society," he said, " is divided 
into three classes, the rich, the poor, and the comfortable 
citizens who form the intermediate class. The first are 
insolent and untrustworthy in great affairs; the second 

* Politics, Book iv. Chap. iv. 



THE RICH AND THE POOR. 41 

become intriguing and knavish in small matters ; hence a 
thousand injustices, the necessary result of deceit and 
insolence, which render them equally out of place in a 
council or in a tribe, and very dangerous in a city. The 
rich imbibe independence with their mother's milk ; raised 
in the lap of all enjoyments, they commence at school to 
despise the voice of authority. The poor, on the con 
trary, beset by distress, lose every feeling of dignity. In- 
capable of commanding, they obey like slaves ; while the 
rich, who do not know how to obey, command like des- 
pots. The city is then only an aggregation of masters 
and slaves ; there are no free men. Jealousy on the one 
side, contempt on the other ; where shall we find friend- 
ship and that mutual benevolence which is the soul of 
society? What a life, with companions regarded as ene- 
mies! " 

" The middle class, therefore," continues Aristotle, "is 
the surest basis of a good social organization ; and the city 
will necessarily have a good government, if this class has 
the preponderance over the two others combined, or at least 
over each of them separately. This is the class which, by 
ranging itself on one side, will keep the balance even and 
prevent either extreme from ruling. If the government 
is in the hands of those who have too much or too little, 
it will be either a fierce demagogy, or, on the other hand, 
a despotic oligarchy. Now, whichever be the dominant 
party, the passions of the democracy and the haughtiness 
of an oligarchy lead straight to tyranny. The middle 
class is much less exposed to all these excesses. It alone 
never rises in rebellion : wherever it is in the majority, this 
restlessness and these violent reactions which agitate 
governments, are unknown. Great states are less ex- 
posed to popular uprisings. Why? Because the mid- 
dle class is numerous in them. But the small cities are 
often divided into two camps. Again why? Because 
we find there only poor and rich, that is, extremes and no 
meansy 



,{2 HISTORY OF POLITICAL ECONOMY. 

It seems as if these lines were written but yesterday 
and thrown out to the readers by one of the thousand 
voices of our times. I have quoted them at some length, 
because they give an exact idea of the economic views of 
the greatest writers of antiquity. In pleading with so 
much warmth .the cause of the middle classes, they did 
not allow themselves to wander off in pursuit of a vain 
Utopia ; they knew what takes place in civil struggles 
where social questions are agitated between rich and poor. 
" The party which gains the victory, does not remain the 
master without opposition. It takes good care not to 
establish a constitution on principles of equal rights. 
The conqueror regards the government as the prize of 
victory : he gives it the livery of his party." * 

The more one reads Aristotle, the more one recog- 
nizes that this great writer summed up in all things the 
most advanced ideas of the civilization of his time. For 
there were in Greece and at Rome, as in the rest of Eu- 
rope since the Christian era, epochs and men that 
merited better than others the privilege of representing 
the character and the thought of several generations. 
Thus can we account for the powerful influence of the 
great men and great writers of Greece, notwithstanding 
the diversity of interests of all the republics which occu- 
pied that little territory. In spite of the numerous changes 
which the institutions of these republics experienced in 
the various ages of Greece, they rested on principles 
nearly alike, but of which slavery always formed the basis. 
All that was not Greek was considered as barbarian ; 
the priests, the legislative philosophers, the warriors, and 
the orators, in turn took their place in power without 
shaking the old foundations of Greek civilization, horror 
of industrial labor, contempt for trade, and indifference 
to everything foreign or servile. In vain did the great 
expeditions of Alexander and the development, of their 
maritime power facilitate among the various Greek nations 

* Foliiics. Book iv. chap. xi. 



CONTEMPT FOR LABOR. ^ 43 

the establishment of a great oriental empire ; their in- 
testine divisions and the abuse of servitude made them 
lose that glorious opportunity, and Greek federalism dis- 
appeared before Roman unity, as soon as the latter was 
manifested. 



CHAPTER IV. 

The Greek colonies and their relations with the metropolis. — They con- 
tributed to extend over a great part of Europe the ideas whose centre was 
at Athens and Sparta. — They were founded like ours, by emigrations, but 
they enjoyed a greater independence. 

The history of ancient Greece presents, like that of 
modern Europe, the remarkable phenomenon of a confed- 
eration of small states keeping in submission immense 
countries, by the simple ascendency of moral superiority. 
The map of the Greek colonies resembles a world, when 
one compares it with that of the Peloponnesus and other 
metropolitan dependencies of the main-land. The Greeks 
had in fact colonies in Asia Minor, on the borders of 
the Black Sea, in Cyprus, Krete, Sicily, Gaul, Spain and 
Africa. They counted their cities in these places by 
hundreds, and we cannot doubt that most of these cities 
enjoyed the greatest opulence, in the sense even that we 
to-day attach to this word. Originally, they were the re- 
sult of conquest ; their inhabitants were seized as slaves, 
and their lands as public property. Later, the conquered 
nations were received on capitulation ; the Greeks sent 
to them the excess of their famishing and turbulent popu- 
lation, and a genuine union was formed between the 
natives and the immigrants. So long as the metropolis 
could keep them obedient by means of its fleets, the de- 
pendence was real : but any interruption in the commu- 
nications was sufificient to bring its supremacy again into 
question. Thus the defeat at yEgospotami made Athens 
lose all her kleruchicB. 

.44 



THE GREEK COLONIES. 45 

We cannot, however, doubt that the colonial govern- 
ment of the ancients was, in general, more independent 
of metropolitan influence than ours. The Greeks had not 
at their disposal the immense fleets of modern nations, 
nor the artillery force which acts at a distance, without 
necessitating disembarkations. Whenever one of their 
colonies rebelled, they were obliged to transport troops 
thither at great expense, and these troops had to be very 
numerous to resist the attack of the enemy. So most of 
the Greek settlements ended in becoming entirely free 
from external influence. Work was honored in them, com- 
merce flourishing, and a competency much more general 
than in the great metropolitan cities. Ephesus, Smyrna, 
Phocsea and Miletus, rose to an unprecedented degree of 
prosperity. Miletus alone had four ports and a fleet of 
more than a hundred vessels. The marvels of Rhodes, the 
riches of Smyrna, and the boldness of the Phocaean navi- 
gators, the founders of Marseilles, are well known. The 
Asiatic Greeks early brought to a high degree of perfec- 
tion the dyeing of wools, the exploitation of mines, and 
the smelting of metals. Their wise men all contributed 
to the progress of the sciences : philosophy and astronomy 
are indebted to them for brilliant discoveries ; the fine 
arts, for magnificent monuments. They had also their 
own constitutions, and they became sufUciently powerful 
to make conquests. The isle of Krete long maintained 
its independence by commerce, and only succumbed be- 
fore Roman domination, 

A great part of present Europe, as Southern Italy, 
Gaul, and Spain, long existed in the condition of Greek 
colonies. ■ Sicily alone was a veritable empire, and the set- 
tlements located in the portion of the present kingdom of 
Naples*, which is bounded by the two Calabrias, attained 
such a degree of splendor that they surpassed the glory 
of the mother country and merited the name of Magna 
Grczcia. All these states traded freely with each other, 

* Written in 1837. Trans. 



46 HISTORY OF POLITICAL ECONOMY. 

and with the parent states. But the very wealth which 
they derived from commerce contributed to their decline, 
by weakening their warlike tendency and creating in the 
heart of their cities an unbridled democracy enervated by 
pleasures, and equally unfitted to maintain a government 
and to substitute another in its place. See Korinth: what 
a magnificent situation for commerce ! She was seated 
upon two seas : she opened and closed the Peloponnesus. 
She had a port to receive the merchandise of Asia ; she 
had another to receive that of Italy ; and Italy was the 
Europe of that time. How many stores ! how many 
vessels ! how many monuments ! but soon she began to 
build temples to Venus and to maintain in them thou- 
sands of courtesans — a deplorable abuse of civilization 
and wealth, which made wealth and civilization flee from 
those fine places ! Thus perished all the Greek colonies 
when they had become nations. They consecrated to 
luxury and pleasure treasures which they might have 
employed to consolidate their independence, and to-day 
we find only under the turf the traces of their former 
splendor. They did nothing for misfortune and for pov- 
erty — no asylums, no help for the ill-favored classes ; none 
of those economies which create capital. They lived 
from hand to mouth, consuming their capital as well as 
their income, until the moment, when, drawn into the 
orbit of the Roman world, they lost their independence 
and their fortune. 



CHAPTER V. 

Political economy among the Romans, in the different ages. They are 
essentially warriors and plunderers under the Republic. — Engineers and 
administrators under the Empire. — Their contempt for labor. — Immense 
devastations committed by them. — Fall of Carthage. — First attempt at 
organization under the emperors. 

We distinguish three great epochs, perfectly character- 
ized, in the history of the eleven centuries which separate 
the foundation of Rome from the accession of Constan- 
tine. The first, almost savage, ends at the beginning of 
the Punic war ; the second, wholly warlike, terminates 
with the battle of Actium ; the third comprises the reign 
of the emperors : it is that of despotism and of adminis- 
tration. The true political economy of the Romans 
dates only from the century of Augustus ; until then, 
they were but husbandmen or conquerors ; under the 
empire, they begin finally to become civilized. Then 
alone the government exercises a universal influence and 
they become really masters of the world. Notwith- 
standing these successive modifications in their consti- 
tution and in their internal policy, the Romans pre- 
serve, from the first days of their history to the fall 
of the Empire, an appearance always the same, and 
tendencies nearly uniform. Placed, at the outset, in the 
midst of independent states, such as the ^qui, the 
Volsci, the Sabines, and the Samnites, they become con- 
querors so as not to be conquered. As conquerors, they 
preserve their military habits, the principal characteristic 
of which is contempt for labor. Labor, in their eyes and 



48 HISTORY OF POLITICAL ECONOMY. 

from the earliest times, is an affair of prisoners and slaves. 
So one of their historians can justly say that at this 
time their only trade is to crush grain and men. Their 
religion is on a level with their morals, and they raise 
temples to Jupiter the Plunderer, Jovi prcEdatori. The 
fine arts, manufactures, and commerce, are still unknown 
to them. At the time of the first Punic war, they know 
not what to do with the fine paintings which they find in 
the city of Tarentum. At Korinth, their soldiers play 
dice on the most magnificent pictures of the greatest 
masters, and one of their generals ventures seriously to 
say to the captain of a ship charged with transporting to 
Rome the master-pieces of Greece: "If you lose any, 
you shall replace them." 

At this period, their language even did not exist. It 
was just what the execrable language of notaries, advo- 
cates and bailiffs is to ours. The change of years was 
marked by a nail solemnly planted every year in the 
wall of the temple of Jupiter, at the beginning of the 
month of September. There were only three divisions of 
the day ; a money of coarse copper sufficed for all wants ; 
and every industrial occupation, as in the Greek repub- 
lics, was in the hands of slaves. Their first poets be- 
longed to that despised caste : Ennius, Plautus, Terence, 
and many other great writers were from it. The Romans 
of that time had a special horror of navigation, and their 
ignorance of that art caused them disastrous mistakes. . 
They therefore made the destruction of the vessels the 
first condition of their treaties with the conquered ; at 
Carthage they burned more than five hundred. This 
aversion to a marine degenerated with them into a 
real monomania, and when they became masters of the 
sea, it was not by their vessels, but by the abse'nce of 
enemy's vessels. Had it not been for the pirates, who 
defied them with impunity in the Mediterranean, even 
to blockading their ports and taking away their public 
functionaries, they would have gladly renounced naviga- 



SUPERIOR CIVILIZATION OF CARTHAGE. 49 

tion, which was in fact only maintained by the aid of 
foreign crews, Greek, Egyptian or SiciHan. Augustus 
himself, who gained the naval battle of Actium, had a 
distressing fear of the water. 

It is at the time of their first struggles with Carthage 
that the edicts proscribing commerce appear. " The 
commercial nations must work for us," say they ; " our 
business is to conquer them and levy contributions on 
them. Let us then continue war, which has rendered us 
their masters, rather than give ourselves to commerce, 
which has made them our slaves." Cicero himself, not- 
withstanding the great superiority of his mind, shared, at 
a most advanced period of the republic, the aristocratic 
prejudices of his fellow citizens. " What worthy of honor 
can come from a shop "? " he naively exclaimed : " com- 
merce is a sordid affair, when it is of little consequence, 
for the small traders cannot gain without lying ; it is a 
business only tolerable at best, when carried on on a large 
scale and in order to supply the country with provisions." * 
With such doctrines on commerce, it is not astonishing 
that the Romans sought, in conquest and pillage, re- 
sources which they thought it unworthy of them to seek 
through labor. Their first riches began with plunder, and 
their history for several centuries resembles that of a 
nation of freebooters. We find in their writers only re- 
citals of robberies and devastations : now, it io the sacking 
of Syracuse, then that of Tarentum, of Syria, of the cities 
of Numidia, then at length the triumph of Paulus ^mil- 
ius, whose triumphal car is followed by one hundred and 
fifty wagons full of gold and silver. Manlius strips Asia 
Minor,- Sempronius, Lusitania; Flaccus, Spain. Seventy 
cities of Epirus are sacked and destroyed, a hundred and 
fifty thousand inhabitants are reduced to slavery ; the 
ruin of Carthage alone produces 500,000,000 in our francs, 
(nearly ^100,000,000). It was a fine day for Rome when 
she despoiled that rival, whose temples were lined with 

* Cicero^ Treatise on Obligations, Book i, Sec. 42. 



50 HISTORY OF POLITICAL ECONOMY. 

sheets of gold, the product of the mines of Spain and 
of the immense trade of the Mediterranean ! 

It has been often asked what would have become of 
civilization, if Carthage had triumphed over Rome and if 
the commercial spirit of the great African city had won 
the day over the warlike policy of her implacable enemy. 
Suffice it to say that Carthage was at the same time an 
industrial and a commercial city, and that she supplied 
all the ports of the Mediterranean with her merchandise 
and her raw materials. Navigation was there carried to 
a high degree of perfection, if we may judge by the Peri- 
plus of Hanno, which is one of the finest monuments of 
that science in ancient times. We must, then, forever re- 
gret that a power which contained all the germs of a 
peaceful civilization should have fallen before a people 
exclusively warlike. The immense capital destroyed in 
that catastrophe would have supported works of great 
benefit to humanity, and it went to Rome to become lost 
in the coffers of patricians and give birth there to the 
most infamous excesses of usury which have sullied the 
history of any nation. Rome seems from that time to have 
become a prey to a fever of speculation and agiotage ; we 
hear only of citizens prosecuted for debts, of the building 
of castles, of unfortunate ones dispossessed of their prop- 
erty. Brutus and Cassius, Antony, Sylla, and even the 
great Pompey become lenders of money on short time at 
exorbitant rates, and do not blush to take off before- 
hand forty-eight and even seventy per cent, interest. 
Verres succeeds in exhausting Sicily ; and Sallust con- 
structs fabulous gardens with the fruits of his plunder in 
Numidia. Cicero, governor of Cilicia, believes himself a 
benefactor of the province, for having lowered the inter- 
est to twelve per cent and a commission in case of a de- 
lay or renewal. Finally, Juvenal can exclaim, later: 
" We are devouring the people to the very bones," after Sal- 
lust had said that his contemporaries " troubled money " 
in every way.* 

* '' Pecuniam omnibus modis vexant." 



ROMAN POLITICAL ECONOMY. 5 1 

These are the men whom we admire and this the civil- 
ization given us for a model, from our most tender 
infancy! Behold the political economy of the Roman 
people, until the first years of the empire ! * 

* The economic history of ancient Italy presents a most remarkable fact, 
which has only been brought into full relief by recent writers, notably by 
Bureau de la Malle, in his Econofiiie Politique des Romains. It is the de- 
population of Italy caused by the disappearance of small estates and the con- 
centration of the lands in the hands of a small number of families, who 
finally possessed all the peninsula. Before the Punic wars, Italy was 
covered with a close population of hard working peasants who themselves 
cultivated their little capital in land, and from whom those Roman armies 
were recruited which conquered the West. In the time of the Gracchi, this 
vigorous population had sensibly diminished, and the end to which above all 
the reformers of the democratic party tended, was to reestablish it by a di- 
vision of the lands of the state. But this end was not attained. On the 
debris of small proprietorship were formed immense domains (latifundia) : 
cultivation on a small scale was superseded by exploitation on a large scale 
by means ot slaves ; the fields of grain were converted into pasturage ; the 
same land which had supported from 100 to 150 families of free peasants, 
was cultivated by about fifty slaves for whom there existed no marriage and 
consequently no posterity. Under these circumstances, the depopulation 
was necessarily rapid, and it was easy to comprehend the causes. Pliny 
said: Latifuiidia perdidere Italiatn. But what was more difficult to under- 
stand, was the economic reason of that absorption of small proprietorships 
by great ones, of that impoverishment of the cultivator in the midst of the 
increasing wealth of the country. — Fr. Ed. 

On this subject, see Mommsen's Rbmische Geschichte, 2d edit., Berlin, 
1856, vol. i. p. 814 et seq. 

Mommsen attributes this state of things in part to the bad habits and dis- 
inclination to labor which nearly always follow long wars, but chiefly to the 
bad policy of Rome in monopolizing the trade in grain of her dependencies, 
thus making it impossible for the Italian peasants to deliver grain in market 
at the prices that ruled at Rome. So their lands were by degrees sacrificed 
to the wealthier land owners,— 7>a«j, 



CHAPTER VI. 

The political economy of the Romans from the beginning of the Empire. 
— Abuses of the conquests. — Contempt for commerce. — rCondition of the 
laboring classes. — Insolent aristocracy. — Famished populace. — People take 
refuge in celibacy. — Public and piuvate self-interest. — Absence of manufac- 
tures. — Utility sacrificed to grandeur. 

In the midst of the chaos of wars and conquests b)'" 
which Rome was agitated until the early days of the em- 
pire, one discerns some attempts at social renovation, and 
sees production become established on regular bases. The 
pacificatory genius of Augustus undertook that great 
task, which was never completely abandoned by his 
successors. A general census of the population and of 
the resources of the empire, a veritable domesday book, 
which unfortunately has not come down to us, furnished 
him the essential elements of the reforms he contemplated. 
Statistics came in, in aid of administration. People could 
know the number of landed proprietors, that of the sol- 
diers, the slaves, and the freedmen. 

The imposts were levied with more order, discernment, 
and impartiality. The right of succession was fixed at the 
twentieth ; a general tax of one per cent on consumption 
reached all commodities. Custom duties, that poison so 
mild and at the same time so fatal to modern industry, 
were established on a most rigorous footing, not for the 
sake of protection, but as means of revenue ; raw pro- 
ducts were subject to them as well as merchandise. The 
duties were paid back in case of reexportation for lack of 

sale ; but the custom-house oflficers, it must be confessed, 

52 



CUSTOM DUTIES. ROMAN GRANDEUR. 53 

were no more tolerant than ours. They were authorized 
to open packages and even to unseal letters, as Terence 
expressly affirms. The omission of the affidavit within 
proper time led to confiscation,* or, if it was recognized 
as involuntary, the payment of double duty. Nero 
wished at one time to suppress that impost in order to 
render himself popular ; but the senate represented to 
him that if that were yielded, the people would soon at- 
tack all the others ; and the emperor surrendered to this 
gloomy consideration. History has preserved for us 
one of these tariffs, and the knowledge that I have ob- 
tained of it permits no doubt that in point of absurdity 
our custom-houses are not much worse than those of the 
ancients.f 

Later, when the empire was divided, under Diocletian, 
into four great prefectures, which embraced several king- 
doms, a remarkable unity was established in all the 
branches of Roman administration. The laws were the 
same from the Tiber to the Danube, from Spain to the 
Black Sea. Thirty legions, forming an effective force of 
about 400,000 men, kept to their duty a great number of 
people, differing in language, habits, and interests. Mag- 
nificent roads connected these vast camps, which were 
situated on river banks, at mountain passes, or on the 
borders of countries still unconquered. Post-relays, kept 
up with extreme care, took the orders of the central gov- 
ernment to all parts of the empire. Immense aqueducts 
supplied with water opulent cities, the number of which 
seems to us to-day fabulous. Notwithstanding the pro- 
digies of which our century has been witness, this Roman 
grandeur still astonishes and overwhelms us ; the greatest 
monarchies of modern Europe pale before the hundred 
millions of subjects of the emperor Claudius. But 
people have until now contented themselves with admir- 

* " Quod quid professus non est, perdat." 

t Pepper, cinnamon, myrrh, ginger, some perfumes, skins of animals, 
ivory, diamonds and other articles of luxury, figure in this document ; but 
our tariffs have spared nothing, not even matches. 



54 HISTORY OF POLITICAL ECONOMY. 

ing the imposing height of the imperial colossus, without 
measuring it, without tracing out the prime causes of its 
elevation, and without seeking the explanation of that 
astonishing existence. By what means could supplies be 
obtained for the consumption of those myriads of men? 
From what budget were the necessary resources drawn 
to feed and clothe that world so different from ours? 
Were there any paupers ? Did people work at great 
enterprises, in workshops, or as during the republic, 
around the domestic hearth ? What was the lot of the 
agriculturist and of the mechanic? How was trade car- 
ried on ? Political economy awaits the solution of these 
grave questions, whose importance the Roman writers 
seem not to have suspected. 

The slave appears always as a social element in the 
constitution of the state. It is no longer Greek slavery, 
nor even that of the middle period of the republic, which 
had the character of a simple domesticity ; the empire 
has become so great that the enormous amount of labor 
indispensable for the maintenance of so considerable a 
population can no longer be demanded of the slaves 
alone. The people must themselves put their hands to 
the work ; and in fact, Rome was full of manufactories * 
where paid workmen shared with slaves consigned to the 
rudest tasks, the fatigues, though not the profits, of manu- 
facture. The most opulent senators carried on these 
works by means of capital and slaves, the latter of which 
they possessed by thousands. New products, unknown 
fruits and useful plants, such as flax and lucerne, were 
daily naturalized. 

But how many lands there were abandoned and fallen 
to waste ! How many magnificent domains transformed 
into sterile parks, while husbandmen were dying of 
hunger! Pliny the Elder deplored this abuse, which we 

* We must not understand this word in the acceptation generally given it 
to-day. The Romans had, in fact, no manufactorieslike those of our day, 
but vast establishments where they made their slaves work under the direc- 
tion of free overseers. 



CAUSE OF THE FALL OF THE EMPIRE. 55 

find again described with the same energy in the writings 
of Columella. People by degrees deserted the industrial 
occupations to devote themselves to callings which were 
becoming fashionable, and there was a time when dra- 
matic performers, gladiators, astrologers and cooks were 
the men most in request. The people soon adopted the 
habits of the great; they must have perfumes like the 
patricians ; and the Emperor Adrian, on a day of public 
entertainment, had them openly distributed to all the 
citizens. Ivory, amber and incense became articles of 
prime necessity, and it was necessary to import them at 
the cost of an enormous sum of money, for the Roman 
people had no products to give in exchange. 

Here the principal cause of the fall of the empire, and 
one of the deepest plague-spots of its political economy, 
begins to manifest itself. The Romans were especially 
inclined to consume without producing, and that error 
brought about the permanent exportation of the greater 
part of the money that they had taken from conquered 
nations. The monumental constructions with which they 
covered Europe, absorbed also notable quantities of it ; 
and these immense amounts of capital passed through 
their hands without leaving either trace or profits. They 
thought themselves the pensioners of the whole world, 
and it never occurred to them that this revenue so easy 
to be consumed would finally no longer be reproduced. 
•They used to take a siesta after their repast, in galleries 
adorned with flowers, where their clients were in the 
habit of coming early in the morning {officia antelucand) 
to pay their respects, after being announced by slave 
nomenclators who were the ushers of these almost royal 
dwellings. The patrician families became organized by 
degrees into a powerful aristocracy whose members had 
themselves addressed as " Your Sincerity," " Your Grav- 
ity," "Your Excellency," and " Your Highness," which 
has become with us, "Your Most Serene Highness." 
Their chariots, profusely ornamented with decorations of 



56 HISTORY OF POLITICAL ECONOMY. 

chased silver, went through the streets with horses at full 
speed, followed by a horde of slaves burning perfumes. 
The people, in their turn, desired their share in the per- 
petual gayeties to which the lords of the time abandoned 
themselves ; distributions were therefore made to them of 
bread, wine, oil, and even baths. The theatres were 
entered at day-break; the most eager sometimes passed 
the night in them. 

In this general disorder of manners and customs, which 
extended back to the latter days of the republic, there 
arose at Rome and throughout the whole empire, a virtual 
conspiracy against marriage. Everybody took refuge in 
celibacy as an asylum inaccessible to the cares and bur- 
dens of a family ; and more than one emperor, after the 
time of Augustus, saw himself obliged to proceed by 
edicts against that mania, which in the times in which we 
live is reappearing from other causes. A censor seriously 
invited the citizens to marriage as to a patriotic obliga- 
tion, and the state seized upon inheritances falling to 
recalcitrant celibates. All the Romans were attacked by 
an invincible repugnance to the spirit of order and enter- 
prise, in regard to everything pertaining to forethought 
and economy. The proletary'' workmen found in the 
slave workmen a com.petition the more formidable as 
these slaves were supported at the expense of their mas- 
ters, and consequently in a condition to injure wage-paid 
workmen. Besides, the number of indigent was consid- 
erable ; they lived heaped together in narrow and fetid 
dwellings, a prey to the most shocking excesses, and to the 
most cruel privations. Their clothing, generally of some 
woolen material, and rarely renewed, would have soon 
propagated among them deadly epidemics, if the use of 
the baths,* universal at Rome, had not prevented any 
such attack. Public beneficence, unknown in those times 
of despotism and slavery, had not yet organized asylums 
for poverty and disease, and Voltaire has truly said : 

*One took a bath for two farthings : " quadrante lavafi," a poet has said. 



LUXURY — POVERTY. 5/ 

•' When a poor devil fell sick at Rome without having 
the means to be taken care of, what became of him ? He 
died." 

So in the midst of the magnificence of the Roman 
power, we perceive only a confused mass of proletaries, 
enslaved, free, domestic and artisan, who work to furnish 
supplies for the unproductive consumption of the great 
owners of capital and of lands. The liberal arts, so glori- 
ous and so noble, are abandoned to servile hands ; medicine 
even is practiced only by slaves. Commerce remains in 
infancy, unless we call the baneful operation of changing 
the gold of the conquered countries for the merchandise 
brought from them, commerce. No Roman city is men- 
tioned as celebrated for any especial manufacture, like our 
great industrial cities, Birmingham, Lyons or Manchester. 
No port of the empire can be compared with that of Mar- 
seilles, Liverpool or New York.* And yet the great cities 
are numerous all over the surface of the Roman world, 
and there is something in their incredible opulence which 
always overwhelms us ; but this opulence does not at all 
resemble that of our contemporary states, where the 
most modest private citizens have at their disposal more 
enjoyments than the privileged individuals under the 
empire. All Roman grandeur was external and theatri- 
cal ; monuments were multiplied through ostentation, 
rarely with a view to utility. By the side of these mag- 
nificent monuments, the people inhabited dwellings un- 
worthy of the nation's splendor, and whose badly lighted 
apartments were nevertheless exposed to the inclemency 
of the seasons. We should judge very erroneously of 
the alimentary regimen of the masses, if we only consid- 
ered the elegance of the utensils which they commonly 
employed for domestic purposes. The graceful forms of 
these excite our admiration, and seem to have been 
suitable only for a rich or artistic people : but these 

* Cicero said : " Nolo eundem populum imperatorem esse terrarum et po» 
titorem." 



58 HISTORY OF POLITICAL ECONOMY. 

articles were very far from answering all the purposes 
of similar utensils in modern times. The Romans knew 
of neither paper nor pens ; they wrote in capital letters 
on leaves of papyrus or on parchment, with styles of 
iron or wood. Their seats were elegant, but very hard ; 
and their chariots, placed on the axles, without springs 
or braces, were scarcely more comfortable than our carts. 
The only things which we can unreservedly admire 
among the productions of their genius are the aque- 
ducts and the great public roads ; and besides there is 
reason for astonishment that constructions so gigantic 
should have been established only in a purely military 
interest and for the embellishment of a few cities. 



CHAPTER VII. 

Importance of means of communication among the Romans. — Services 
their great roads might have rendered to civilization and commerce. — Sketch 
of the principal Roman laws in matters of public economy, — General view 
of their commerce. 

The great roads of the Roman empire surpassed in 
grandeur and solidity the most magnificent constructions 
of this kind that have been executed from time imme- 
morial ; their ruins, which we still admire under the grass 
which covers them, do not permit us to question the im- 
portance that was attached to perfecting these mighty 
elements of power and civilization. And yet these great 
roads do not seem to have rendered to civilization all the 
services which it derives from them to-day : they did not 
become to Rome the source of great commercial pros- 
perity: they rarely prevented poverty and its consequent 
evils. The Romans saw in them only the means of 
transporting their armies rapidly from the centre to the 
frontier, — in a word, only an instrument of conquest and 
not of industry. Never in any country in the world 
were more treasures consecrated to that important work, 
and never did any people gather less profit from such 
great sacrifices.* 

The reason of this fact is very simple. The only occu- 
pation of the Romans was agriculture, the products of 
which v/ere generally consumed on the spot, or within a 
very narrow circle from the centres of production. The 
great supplies of the capital city usually came by sea^ 

* " opera magna totius quam necessaria," said Suetonius. 

59 



60 HISTORY OF POLITICAL ECONOMY. 

which was the only way by which the grain of Sicily and 
of Egypt, those two granaries of the empire, arrived. 
We can then explain the magnificence of the Roman 
ways only as a necessary consequence of the military sys- 
tem of this anti-industrial and anti-commercial people. 
They made their soldiers, their administrators, and their 
subjects, contribute to them with equal zeal. The super- 
vision of the roads was an imposing magistracy with 
which the greatest citizens appear to have been honored. 
No tax seemed too high when the maintenance of the 
roads was in question ; and the severity of the government 
was so great in that regard, that more than once legions 
revolted in consequence of the excessive labors to which 
they were condemned in the care of them. Whatever 
were the vicissitudes of the empire, the maintenance of 
the roads was never abandoned : the worst rulers watch- 
ed over them with the same solicitude as the most just : 
Nero and Caligula constructed almost as many as Trajan 
and Adrian.* The labor on them was either by corv^es 
or by contributions, each person working or contributing 
according to the importance of his property bordering on 
the road, estimated by referees and taxed accordingly. 
The communications were divided into two great classes, 
the royal or military roads, and the roads for the accom- 
modation of a parish or community.^ The former were 
maintained by the state, and the latter by the market 
towns or villages. 

The popular sympathies were always with the rulers, 
the magistrates, and even the private citizens, who devoted 
themselves to this difificult task. Crowns, medals, and 
triumphal arches were lavished upon them. History is 
therefore full of the extraordinary efforts made to merit 

* See Bergier, Histoire des grands chemins de F Empire Romain, Book i, 
Chap. i6. 

f ViaiTim omnium non est una et eadem conditio. Nam sunt vias publicae 
regales, quae publice muniuntur : sunt et vicinales viae quae de publicis di- 
vertunt in agros ; hse muniuntur per pagos. — Siculus Flaccus, De Conditioni' 
bus Agrorum. 



MAINTENANCE OF THE ROADS. 6 1 

these distinguished proofs of gratitude from the Roman 
people. In the time of Tiberius, one could travel over 
all Italy, Gaul, and a part of Spain, with unheard of ra- 
pidity, and Pliny relates that this ruler made, on a jour- 
ney to Holland, more than a hundred leagues in twenty- 
four hours. The nature of this work forbids us to give 
here the well-known details of the mode of construction 
of the imperial roads ; but we must acknowledge that in 
this kind of labor we are much inferior to the ancients ; 
and although their roads did not have great influence 
over the destinies of commerce, we can but wonder at 
their lasting more than a thousand years, while ours, 
more necessary, will with difficulty keep for a few years 
intact. Nothing was forgotten there ; the pedestrians 
had their foot-paths, and the horsemen their resting stones 
for mounting and alighting. The monuments to the dead 
usually arose in their vicinity, as if to obtain the regard 
of the living. The Appian way is the most admirable 
master-piece of this kind which has ever come from the 
hand of man. 

It would seem, then, as if the Romans ought to have 
derived immense advantages from the fine system of roads 
with which they had covered the empire as with a vast 
network. But these roads more frequently saw the 
chariots of warriors roll over them than the peaceful con- 
veyances of commerce and the industrial arts; they con- 
tributed in no manner to the rise or fall of profits and 
wages, because free labor did not yet exist, and every- 
thing was established, as we have said, for grandeur rather 
than for utility. The great roads of the empire had no 
other end than to facilitate the transportation of sol- 
diers and of tributes.* The movement of specie which 
continually took place from all parts of Gaul towards the 
city of Lyons on the account of the public treasury was 
immense, but there was no commercial circulation in the 
sense that we attach to the phrase. Strange to say, the 

* " Ut omnia tributa velociter et tuto iransmitterentur" said Procope. 



62 HISTORY OF POLITICAL ECONOMY. 

invention of bills of exchange has furnished us a substi- 
tute for the principal use of the great roads of the 
Romans ; and the especial service for which they seem to 
have been made is exactly that which can best be dis- 
pensed with to-day. Thus the magnificent works of 
Roman administration exercised no influence over gen- 
eral production, because they participated in the exclu- 
sively military character of the nation and the general 
spirit of its institutions. 

All the Roman legislation, from the great days of the 
republic to the fall of the empire, is only the faithful re- 
production of the incurable prejudices of the people 
against labor and the industrial arts. A rapid glance will 
sufifice to give an idea of it. In the beginning of their 
power, they brought forward a multitude of agrarian 
laws,* all inspired by a vain desire for division of the 
lands and equality of fortunes. The Terentian Law pro- 
vided that five bushels of grain a month should be dis- 
tributed to every needy citizen ; the Senipronian law 
zx&'dX&A 2l maximum iox \hQ. price of the grain which the 
state should sell them ; the Claudian law decreed a gratu- 
itous distribution of it. Another law fixed the expense 
of the meals ; the Caniniait law forbade any one to free 
more than a certain number of slaves. At the same time 
that they were thus increasing the number of the indigent 
by inconsiderate largesses, veritable premiums were ac- 
corded to fecundity ; every man who was the father of 
three children, enjoyed a multitude of privileges, of which 
the principal consisted in a triple gratuity of wheat. In 
other circumstances, the law authorized debtors to be- 
come free by paying simply a quarter of their debts. 

While the spirit of independence and enterprise was 
paralyzed by this legislation, which protected idleness, all 
classes of citizens were kept in the strictest subordination, 
commencing at the domestic hearth, where the father of 

* Leges Cassia, Licinia, Flaminia, Sempronia, Cornelia, Servilia, Flavia, 
Julia, etc. 



DIFFICULTY OF SUPPLYING FOOD. 63 

the family reigned as absolute master, armed with the 
right of life and death over his children. The wife, de- 
graded to tutelage, was only the servant of her husband. 
Outside of the family, every freed man recognized a pa- 
tron, every soldier a superior. Military organization 
rested upon the whole city, like an iron yoke from which 
no one dared to obtain release. No citizen could leave 
his caste, even to go below it, and industrial occupations 
were forbidden as a low and sordid thing, to those who 
had not been condemned to them by birth. Augustus 
pronounced the penalty of death against the senator 
Ovinius for having stooped to direct a manufactory ; and 
this decree, to us so extraordinary, seemed to the Romans 
perfectly natural. Who cannot see that from that time 
every industrial occupation was impossible at Rome, since 
intelligence was excluded and only machines tolerated ? 
And what machines were these unhappy slaves, brutalized 
by blows, by the debauchery of their masters, and espe- 
cially by the absence of any kind of wages ! In the coun- 
try, the consequences were the same : no farmers, no in- 
structed cultivators. The agriculture resembled that of 
our slave colonies, with this difference, that the soil of the 
tropics compensates by its fertility for a deficiency in the 
labor of man, while the Roman fields offered no such 
compensation. Competition and personal interest, those 
great motives, did not act upon minds preoccupied with 
ideas of war and pleasures. There might constantly be 
seen hurrying to Rome myriads of adventurers, intriguers,* 
and vagrants, attracted by the distribution of food and 
by the spectacles of every kind which the emperors lav- 
ished on the populace in order to obtain from them a few 
plaudits.* The outskirts of Rome became cities, and 
the government had not a few difficulties to conquer to 
supply food to this innumerable crowd of unproductive 
consumers. 

Notwithstanding the infinite precautions taken to avoid 
* Mengotti, Del commercio de'Romani. 



64 HISTORY OF POLITICAL ECONOMY. 

it, famine at times made sad ravages in the capital and 
the provinces. In vain the fleet, loaded with provisions, 
bore the name of the sacred fleet ; a gale of wind some- 
times prevented its arrival and put in peril the imperial 
security. The art of governing was soon no longer any- 
thing but providing for the daily needs of an idle and 
fickle populace ; and the least occasion gave rise to num- 
berless abuses, which, by frequent repetition, grew into the 
force of law. The death of a mistress of the ruler, the 
birth of a successor, a bloody war, an innocent triumph, 
equally necessitated copious distributions. The Roman 
emperors kept their crowns at this price, and maintained 
their authority only by paying scrupulously the poor-tax 
to their hungry subjects. " These dogs," said one of the 
Caesars, " cease to bark only when they have a full stom- 
ach." We can reckon by the number of famines that of 
the improvements brought about in the affairs of commerce 
and navigation. A first famine under Augustus is follow- 
ed by the establishment of a fleet and of public storehouses 
for the sale of grain ; a second famine under Tiberius gives 
rise to the system of bounties on the importation of 
grain. A third under Claudius decides the ruler to 
have the port at Ostia repaired ; a fourth under Nero pro- 
cures for the grain merchants medals and an exemption 
from duties ; another under Antoninus Pius causes the 
port of Terracina and the light-house of the jetty-head at 
Gaeta to be repaired. During the reign of Marcus Aure- 
■ lius there is another famine, followed by laying in a seven 
years' supply of provisions ; finally, during the adminis- 
tration of Commodus, catastrophes of the same kind be- 
come fatal to the grain merchants, who are prosecuted 
and punished as monopolists. This is all they knew how 
to do at Rome for commerce — I might almost say for the 
only commerce in good repute, that for means of subsist- 
ence. Nowhere do we find a single trace of regular mea- 
sures ; people live from hand to mouth, without dreaming 
of the resources that might easily have been developed in 



IMPORTATION. IMPOSTS. " 65 

the heart of the empire, and they give scarcely any atten- 
tion to the other branches of production. 

Thus, wool, — almost the only raw material of all the 
cloths used at Rome, from the clothing of the senators to 
that of the lowest soldiers — wool, from which they made 
sheets, curtains, carpets, furniture of every kind, was 
never the object of any system of encouragement on the 
part of the emperors. Never did a Roman statesman 
descend to industrial details which would lead us to sup- 
pose that he comprehended the importance of these great 
questions. Every country furnished its tribute : Arabia 
its perfumes ; Africa its cereals ; Spain wax and honey ; 
Gaul its wines, oils and metals ; Greece artistic and fancy 
articles ; and the shores of the Black Sea, leather and 
skins. Rome consumed, and paid with the gold from the 
imposts. When the latter did not correspond to the pre- 
visions of the imperial budget, a new tax was levied on 
manufactures. Alexander Severus did this several times. 
In proportion as the emperors surrounded themselves 
with lawyers and jurists, their disposition toward the la- 
boring classes became daily more threatening. Compilers 
of laws suggested to them shameful expedients which 
they justified by sophisms ; it was a public prosecutor 
who taught them how to debase the coin. Constantine, 
their most worthy pupil, likened salesmen in shops to 
women of the town, and pursued with his dreadful anathe- 
mas the men who had the honor to earn their living by 
the sweat of their brows. 

The manner in which imposts were levied testifies no 
less to the strictness of the Romans in matters of finance. 
Clouds of publicans were posted at the entrances to the 
ports, at the mouths of rivers, at the exits from the val- 
leys, and there they mercilessly taxed the merchandise. 
They also often had, in addition to their fees as collec- 
tors, the profits of the monopoly of certain articles of con- 
sumption. There was no legal limit to the sum total of 
the taxes., which had become so elastic in the hands of 



(^ HISTORY OF POLITICAL ECONOMY. 

these functionaries, that the cultivator could never know 
exactly upon what part of his products he had the right 
to count. Nero himself had more than once a feeble de- 
sire to repress these abuses which caused the fortune of 
his favorites, but he encountered difficulties before which 
his absolute power was obliged to recoil. It is well known 
how far the exactions of the proconsuls extended even 
as early as the time of Cicero, and the financial operations 
of Verres fully equalled those of the Turkish pachas. 

One single branch of commerce appears to have long 
withstood the restrictions of every kind which the cu- 
pidity of the government and its agents placed upon 
relations with foreigners, namely, the trade in perfumes 
and spices from India, the consumption of which at 
Rome surpassed anything we can imagine. Extravagant 
sums were lavished by mere private citizens on the pur- 
chase of these ruinous and useless articles, which kept 
almost as many ships employed as were engaged in pro- 
visioning the capital. Besides the real dangers braved 
in going to the most distant coasts in search of them, 
imaginary perils, such as winged dragons and ferocious 
beasts that it was necessary to conquer to reach the 
country of pepper and cinnamon, were taken into ac- 
count. In the apartments of the Romans, one every- 
where breathed the fragrance of the most exquisite 
perfumes: their hair and clothing were permeated with 
them. The halls of the baths and the places of public 
assembly offered no less luxury, in this respect, than the 
residences of the most opulent citizens. One fine day, 
the emperor Adrian inundated the vestibule of the the- 
atres with a wave of the sweetest oils. The soldiers used 
to rub their bodies with them, and these were a kind of 
rations whose distribution the emperors could not with 
impunity neglect. Diamonds and precious stones, other 
useless articles, shared with the perfumes the frenzy of 
the Roman people : in the Augustan age, people made 
immense collections of them, and M^cenas prepared a 



LUXURY AND IDLENESS. d"] 

catalogue of his, which has been substantially preserved 
for us in the writings of Pliny the Naturalist. The use 
of rings became so general, that the Romans wore them 
on all the joints of the hand and changed them every 
day in the week. In such things was sunk an immense 
amount of capital, a better employment of which would 
have sufificed to keep the empire from the misfortunes 
which it afterwards had to undergo. Even Tiberius 
was alarmed, for in a letter to the senate* he deplored 
the exportation of money, occasioned by the excesses 
of luxury and vanity. One of his edicts prohibited the 
employment of gold in plate for the table, and the use 
of silk for garments. Notwithstanding all these prohibi- 
tions, the Romans became daily more and more habituated 
to the use of the most showy and expensive articles of for- 
eign manufacture. Persian carpets, India muslins, ivory, 
ebony, tortoise shell, and plumes of rare birds, had finally 
become to them articles of prime necessity. How much 
wealth they must have consumed unproductively in the 
purchase of these articles for display, in exchange for 
which they had only gold to give ! f 

One can hardly comprehend, in view of this sys- 
tem of lavish expenditure, luxury, and idleness, how 
tke Romans could have covered the world with the 
monuments of their architecture and with the magnifi- 
cent works of their engineers ; but we must consider that 
these astonishing works cost them very little. Only the 
invention of them was wholly theirs ; their execution was 
the work of conquered peoples. The greater part of these 
edifices were constructed by means of corv^es^ and special 
contributions which were in addition to the ordinary im- 
posts. Captives or slaves formed the working class of 
their time, and proceeded to their work like flocks of 
sheep, without murmur or complaint. We shall find this 

* Tacitus, Annales, Book 3. Chap. 53. 

f Minima compulatione millies centena millia sestertium annis omnibus 
India et Seres, peninsulaque ilia, Arabia, imperio nostro adimunt ; tanti 
nobis deliciae et feminae constant ! — Pliny, Hist. Nat., Book 12, Chap. 18. 



68 HISTORY OF POLITICAL ECONOMY. 

system again in the corvee of the feudal times, when 
Christian Europe in its turn became covered with monu- 
ments inspired by other beliefs, but executed by the 
same means. 

Moreover, the Romans never lacked resources when- 
ever it was necessary to tax themselves to make up for 
the inadequacy of the treasures furnished by conquest 
and pillage. * There were three sorts of taxes, the 
portorium or custom duties (a fortieth of the value), 
w^hich were paid on imports and exports, the collectors 
of which took the name of portitores or collectors of 
customs ; the tithes, decumae, including the tenth part of 
the grain and the fifth of other agricultural produce, was 
the land-tax ; lastly, the tax known under the name of 
scripttira, a sort of octroi on such property of communi- 
ties as pasturage and public woods. There was for a 
long time a tax on salt, but it was suppressed at a 
time which authors have neglected to state. The col- 
lecting of all these taxes was publicly let out by the 
censors to contractors who gave security and who 
shared with their respondents the chances of loss or 
gain. A great number of other taxes, of a temporary 
nature, were established under the emperors ; thus, Au- 
gustus decreed the impost of a twentieth on inheri- 
tances, which still exists among us ; Caligula levied on 
articles of food a tax the collection of which excited 
the most bitter complaints f; Vespasian invented the urinal 
tax. A duty of five per cent on all merchandise 
brought also considerable sums. This was only paid on 
effects exposed for sale in the public place, and at fairs 
and markets, or sold at auction ; but we can only approxi- 

* In the year of Rome 586, the annual tributes of the people were 
remitted, the treasury having been filled by the immense sums which 
Paulus ^milius deposited there, after the defeat of Perseus. 

f Vectigalia nova atque inaudita, primum per publicanos, deinde, quia 
lucrum exubeiabat, per centuriones, tribunosque prsetorianos exercuit nuUo 
rerum aut hominum genere misso, cui non tributi aliquid imponeret.-' 
Suetonius, in Calig. Cap. 40. 



AMOUNT OF TAXES. 69 

mately estimate the importance of these revenues, be- 
cause of the loss of the famous Rationarmin Imperii, that 
valuable collection of statistics of the empire, prepared 
under Augustus and destroyed under his successors. M. 
Guizot,* however, estimates the amount of the taxes at 
the sum of nine hundred and sixty millions of francs a 
year. 

* Notes on his translation of Gibbon. Vol I. p. 377. 



CHAPTER VIII. 

Rapid decline of the empire. — Its principal causes. — First appearance of 
Christianity. — Influence of Asiatic manners at Constantinople. — Modifica- 
tion of civil, religiwus, industrial, and commercial ideas. 

In the midst of that apparent prosperity, the Roman 
world contained active germs of decay and dissolution. 
The great number of foreign peoples which conquest had 
successively united to the empire, by insensibly modify- 
ing its habits, was weakening its power. These peoples 
were not all unresistingly merged into the great unity, and 
several kept faithfully in memory their former indepen- 
dence. The numerous privileges which the inhabitants of 
Rome enjoyed were an object of ambition to all men of 
importance in the conquered provinces, so that people 
no longer wished to be considered of the empire, but of 
the city A radical transformation was thus taking place 
by degrees, favored by the accession to the throne of that 
long series of Italian, Spanish, Gallic, or Batavian candi- 
dates, thrust into power by murder, intrigue, or military 
seditions. Then comes the turn of the Barbarians. After 
the Antonines, we see only Thracians, Pannonians, Dal- 
matians and Illyrians dispute with each other the empire ; 
sixty of them perished by violent death in a century and 
a half. The one who opens that fatal series, Maximin, 
chosen for his form and his colossal strength, coarse, 
speaking with difiticulty the language of the people he 
rules, excels in drawing a wagon, splitting trees, reducing 

70 



APPEARANCE OF CHRISTIANITY. 



71 



Stones to powder, and training wild horses ; he fills sev- 
eral cups with his sweat. Thus the reign of intelligence 
ends to make way for brute force. 

Political economy does not undertake to explain the 
long saturnalia of the empire during this period of in- 
famy and decrepitude. Who could form a correct idea of 
such a movement of decomposition, complicated by 
slavery, by invasion, by the mixture of races, of lan- 
guages, of customs, and of vices — a sort of social chaos 
in which science is arrested and imagination goes astray.? 
What political organization could have resisted the ex- 
travagances of monsters like Commodus, Caracalla, and 
Heliogabalus? When such beings appear on the earth, 
they can figure on it only as elements of dissolution, and 
some new light will not be long in coming forth from the 
darkness they have made. That light, which shines in 
the later horizons of the empire, is Christianity : let us 
attempt to study it at its dawn and to explain its great 
influence, destined to change the face of the world. 
When it began to appear, one could scarcely have fore- 
seen the brilliant career which it was to run, and yet all 
things were already concurring to prepare its triumph. 
Philosophy was attacking the pagan deities ; Greek scep- 
ticism, having arrived from the country of Plato, was al- 
ready making war on the old Roman beliefs, and hence- 
forth augurs could no longer look at one another without 
laughing. In vain had each trade taken a god for pro- 
tector : the sailors, Neptune ; the blacksmiths, Vulcan ; 
the farmers, Ceres; the vinedressers, Bacchus; and the 
merchants, Mercury : the gods were already having diffi- 
culty in protecting themselves, and were making ready 
to give place to other patrons more powerful. 

Legions, encamped on the frontiers, and composed of 
soldiers levied in the conquered countries, were returning 
toward the centre, and auxiliaries were becoming enemies. 
Meantime, orators were declaiming in the cities ; slaves, 
trained by their masters to voluptuousness and excessive 



72 HISTORY OF POLITICAL ECONOMY. 

refinement, were becoming weary of the yoke ; Lucian, 
the Voltaire of the time, was ridiculing social distinc- 
tions of superiority ; stoics, epicureans and academicians 
were preaching bold doctrines ; and all the old edifice 
of the Romans was falling away. A violent reaction 
had already warned them, under Mithridates, to mistrust 
fortune, the day when he caused sixty thousand to be 
slaughtered ; and at another time, Spartacus, that great 
chief of the slaves, had beaten four of their generals. 
Who then would henceforth be willing to shed his blood 
for the old national cause ? There was no longer a na- 
tion properly so called, but rather a confused assemblage 
of nations. The empire was composed of cities separated 
by deserts, forests, or impenetrable swamps ; the inhabit- 
ants of the villages, rustica proles, had by degrees become 
infiltrated into the cities, where the public spectacles, the 
distributions, and enjoyments of every kind attracted 
them continually and enervated them. 

It was at the time of this universal decadence that 
Christianity began to appear in some parts of the empire. 
The first of^cial information received of it is found in a 
letter from Pliny the younger, governor of Bithynia.* 
Immediately the new doctrine spread like lightning, 
timidly at first, but without any one having time to take 
note of it. Scarcely had one finished reading what the 
governors of the provinces were saying, when Tertullian 
was already boldly crying out : " We are only of yester- 
day, and we are filling your cities, your colonies, the 
army, the palace, the senate, the forum ; we leave you 
only your temples." In vain bloody persecutions at- 
tempt to stifle the new religion at its source ; Constantine 
gives it temples, and its destinies become accomplished^ 

* The following is a passage from that letter : " The thing has appeared 
to me worthy of consultation, principally because of the number of the 
accused ; for many persons of every age, both sexes, and of every condition, 
are put in peril. This superstition has infected not only the cities, but the 
market towns and the country. * * * They are accustomed to assemble 
a certain day before sunrise and repeat together, in two choruses, a canticle 
in honor of Christ as a god." 



DIVISION OF THE EMPIRE. SUNDAY. 73 

The historians of that grand epoch have sufficiently re- 
traced all the circumstances which prepared the way for 
it; our part is to study the humanitarian results, and to 
find out by what happy transition Greek and Roman 
slavery was obliged to give way to respect for labor, to 
the regime of liberty and equality. 

The division of the empire into two vast fragments 
singularly favored that unprecedented revolution. Con- 
stantinople was more suitable than Rome to receive the 
God of the Christians ; a city entirely new, it was mar- 
vellously appropriate for a new worship. It was from in- 
gratitude that this worship adopted, in later times, Rome 
for its cradle ; the true cradle of Christianity was at Con- 
stantinople. There it was that the Christian religion, 
having become a state religion, began to be organized on 
regular bases ; there it established itself, radiant, on com- 
ing forth from the catacombs of Rome and from the ob- 
scure asylums of persecution. By degrees all the high 
intellects, weary of Roman polytheism, rallied about it, 
and the priests everywhere took the place of the curiales, 
who were the municipal oflficers of the time. The laws 
began to give them privileges which the confidence of 
the people ratified, and which they everywhere endeav- 
ored to justify by their knowledge and ability. There is 
no study more curious than the transition by means of 
which that revolution was brought about. Constantine 
published in the same year two edicts, one of which 
recommended the observance of Sunday, and the other 
gave directions for consulting the augurs. At the same 
time, the first distinctions were made between the spir- 
itual power and the temporal power. On another side, 
the lawyers invaded the empire with law-texts, substitut- 
ing thus the influence of the laws for that of the sword, 
and becoming, perhaps without suspecting it, the most 
powerful auxiliaries of religion. Dying Rome perished 
shrouded with monuments ; rising Constantinople arose 
upon heaps of books. Lawyers and priests succeeded 



74 HISTORY OF POLITICAL ECONOMY. 

architects and warriors. The Pandects, the Institutes, 
the Gospel, henceforth shared the respect of the people 
and were of universal influence. An incessant hum of 
counsellors' pleas succeeded the shout of battles, and the 
single prefect of the praetorium employed seven hundred 
and fifty barristers. The patriarchate was no longer 
anything but a life dignity ; heredity had been taken 
from it. The empire, divided into several dioceses, as 
large as kingdoms, and governed by vicars, saw completed 
the work of decentralization which was to favor at the 
same time the attacks of the Barbarians and abuses 
in the administration of justice and in the processes of 
law. The world was going to be a prey to lawyers, who 
are threatening it still more seriously at the time when I 
am writing. Their fortunes were so rapid, and their ex- 
actions so scandalous, that the Theodosian code was 
obliged to threaten them with the penalty of death.* 
Details on this subject may be found in Ammianus Mar- 
cellinusf which might lead one to singular comparisons 
with the abuses of our days. 

The division of the seat of the empire also brought 
about notable changes in the system of assessment. Con- 
stantine and his successors preferred a simple and direct 
tax to the more complicated system of Roman origin, of 
collecting tributes. The collection of that tax was effect- 
ed by the cities, and formed one of the heaviest burdens 
of the dectcrions, members of their municipal senate. 
These administrators were responsible to the amount of 
their personal property for the return of the tax, and 
they were even compelled to take on their own account 
lands abandoned by possessors who could not satisfy 
the agents of the treasury. On them alone devolved the 
disagreeable duties of assessors, which exposed them to 
the dissatisfaction and often to the violence of the people. 

* " Cessent rapaces jam nunc officialium manus ; cessent, inquam ; si 
moniti non cessaverint, gladiis prsecidentur. " Lib. l. vii, Law I. 
f Lib. XXX. 



TAXES. LICENSES. 75 

All the lands of the state, the patrimony of the emperor 
not excepted, were subject to the tax, and every new pro- 
prietor had to pay the debts of the previous one. An 
exact register, revised every fifteen years, allowed the 
boundaries to be determined with sufificient impartiality, 
since care was taken to mark on the registers the particu- 
lar nature of every piece of property, whose value was 
estimated by the average income for five years. The tax 
was generally paid in gold money ; but a considerable 
part of it was required in provisions, of every kind — wheat, 
wines, oils, wood, and forage — which were to be transport- 
ed at the expense of the tax-payers to the store-houses of 
the emperor, and which gave rise to fearful contentions. 
Complaints having become general, the emperors had re- 
course to other expedients, among which may be classed 
the invention of licenses, which were required for the car- 
rying on of every industrial art and of commerce. People 
were even obliged to pay the public functionaries in kind ; 
and Lampridius * tells us that independently of a salary 
of about 4,000 francs in our money in specie, the governors 
of the provinces received six jugs of wine, two mules and 
two horses, two ofificial robes, one simple robe, a bath, a 
cook, a muleteer, and finally, when they were not married, 
a concubine : quod sine his esse non possent, says the au- 
thor. When they gave up their ofifice, they were always 
obliged to return the mules, the horses, the muleteer and 
the cook. If the emperor was satisfied with their admin- 
istration, they kept the rest ; if not, they were obliged to 
return fourfold. We see in other writings that the 
governors of two great provinces received oil for sup- 
plying four lamps. 

Some Asiatic custom was daily introduced into the 
financial government and into the practices of the empire 
Eunuchs, spies, and ofificers of domestic service, were mul- 
tiplied beyond measure, and with them meanness, accu- 
sations and favoritism. It was at this time that the Bar- 

* Chap. xlii. 



76 HISTORY OF POLITICAL ECONOMY. 

barians about the shores of the Black Sea, at the mouths 
of the Danube and on several other frontiers, began to re- 
cognize the vulnerable parts of the empire and to prepare 
for the great invasion which was to change the face of the 
world, after they had themselves been changed by Chris- 
tianity, Let us then examine the influence of Christianity 
on social development in Europe, and learn what mod- 
ifications its definite establishment brought about in the 
political economy of the ancients. 



CHAPTER IX. 

Changes in the social economy of Europe through the influence of Chri* 
tianity. — Its vigorous and able organization. — The monasteries create com. 
munity life. — The religious principle gives rise to hospitals and asylums. — 
The priest to-day unequal to his task. — Opinion on this subiect. 

The sensation was great in Europe, when Christianity, 
hitherto proscribed and humiliated, suddenly rose to 
the rank of the dominant religion and in its turn per- 
secuted its persecutors. What a revolution ! Every- 
thing changes almost at once ; everything becomes re- 
organized on new bases as if by enchantment. Political 
power, hitherto maintained only by physical force, seeks 
auxiliaries in reason and in creeds ; it surrounds and 
fortifies itself with the prestige of religious authority, 
which has taken deep root in the hearts of the people. 
It is marvellous to see the readiness with which the 
world, still pagan in worship, hastens to deduce conclu- 
sions from the gospel word, and the admirable instinct 
with which each oppressed one divines that the hour 
of freedom is about to strike for him. Although the 
Christian church appeared all organized, with its noble 
and austere hierarchy, every one had soon comprehend- 
ed the principle of equality which it bore in its bosom. 
It pleased the great by its dogmas of subordination 
and obedience, and the humble by its doctrines of in- 
dependence and of equality before God. It raised the 
slave without lowering the master, and presented to the 
human race bowed under the yoke, a refuge from the 

77 



78 HISTORY OF POLITICAL ECONOMY. 

tyranny of this world in the hopes of the other. Pa- 
ganism had rarely mingled with politics ; but the first 
Christian priests took part in afTairs, and they were aL 
ready governing before any one had a suspicion of their 
power. The heresies even which troubled Christianity 
at its beginning, were not useless to the cause of social 
progress ; they opened in Europe the right of discussion. 
The majesty of this fine structure excites astonishment 
and commands respect even in those who are not very rig- 
id Christians. We cannot, without lively admiration, see 
that vigorous and stately organization form, complete in 
all its parts, with its magnificent dependencies, and spread 
over the world, everywhere consistent with itself, like a 
great wave over the surface of the strand. The first 
bishops, so imperious and at the same time so gentle, so 
intolerant to doubt and so indulgent toward weakness, so 
proud with the great and so humble with the poor, seem 
to be tribunes of the people, come to protest in the name 
of the imprescriptible rights of humanity. Everything 
there recalls the old maxims of the Roman republic; 
as, for example, the public election, and the preaching re- 
hewed from the forum, the general assemblies, and the 
admission to the highest dignities without distinction of 
fortune or of birth. Nothing was remaining of the an- 
cient prerogatives of the citizen except a barren and con- 
fused remembrance ; the Christian religion has regenerated 
everything, restored everything to honor. Only a few 
years after the reign of Constantine, the affranchisement 
of slaves is permitted on the simple attestation of a 
bishop ; concubinage is proscribed ; the property of 
minors and of women is exempt from confiscation, the 
prisons are visited, the poor succored, beneficence is dis- 
covered. We shall reason about it later ; meanwhile, they 
practice it. 

Political economy is also under many other obligations 
to the influence of Christianity, which made that narrow 
and egoistic sentiment of nationality disappear, the source 



SERVICES RENDERED BY CHRISTIANITY. 79 

of the long quarrels of Athens and Sparta, of Carthage 
and Rome, those deplorable arenas where so many social 
resources were exhausted which another principle might 
have made fruitful I The single creation of councils was 
one of the most happy conceptions of the genius of 
Christian civilization, even considering them only as con- 
gresses where all intelligent minds were convoked iot 
the discussion of an idea. How much time was neces- 
sary for these noble inspirations to triumph over a war- 
like and barbarous prejudice ! It is but a few years since 
J. B. Say finished demonstrating, in his fine theory of 
markets, the doctrine of the commercial solidarity of na- 
tions ; and in our day it has not been without difficulty 
that the solution of differences between nations has been 
remitted to diplomacy rather than to the sword. What 
prepared these results, if not Christianity ? And what 
to-day is civil, religious and commercial freedom, but the 
development of the fundamental Christian thought ? 
Without the new principle of equality before God, Greek 
and Roman slavery would still infest the world, weakness 
would be always at the mercy of physical power, and 
wealth would be still produced by some to be consumed 
without compensation by others. 

Viewing it in respect to the distribution of power, 
there is no human institution which can be compared with 
the truly admirable organization of the church since the 
official appearance of Christianity. A Pope sits at Rome 
and holds under his power the high dignitaries of the 
clergy, who themselves assign to the members of lower 
rank their respective duties. All these are subjected 
to the same rules and the same garb, from Paris to 
Japan an'd from China to Rome. The same service is 
celebrated in the same language throughout the world ; 
the names of the saints of Christianity figure at the head 
of our registers of births, and we distinguish the days of 
the year Only by the nomenclature of its apostles and 
martyrs. The Sunday of the Christians has become a 



8o HISTORY OF POLITICAL ECONOMY. 

day of universal repose ; everywhere, when the church 
opens its temples, labor closes its workshops. There is 
not a single important circumstance of life which escapes 
the influence of religion or which takes place without its 
intervention. The Christian priest awaits at the baptismal 
font the newly-born babe and bestows upon him a name ; 
later he blesses his marriage ; finally, when the end of 
life has come, he accompanies him with prayers to the 
tomb. How many powerful motives of action Christian- 
ity has since discovered, to take hold of the entire exist- 
ence of man ! Everywhere we see the priest become the 
instructor, and direct childhood by his counsels. The 
catechism assures him that conquest without effort ; a 
first sacrament, the communion, creates an additional 
bond, strengthened by the mysterious and awful commu- 
nications of the confessional. Then, as if these first suc- 
cesses were not enough, the bishop appears in all the maj- 
esty of his ecclesiastical authority and administers the 
confirmation, grants dispensations, pronounces censures, 
binds and unbinds as supreme arbiter and vicar of God. 
Thus, neither childhood, nor mature life, nor old age, 
nor death, can withdraw one from the influence of the 
priest, the most complete and the most inevitable which 
ever existed in the world. 

This is not all; and we can scarcely more than indi- 
cate the unlimited prerogatives of the religious power. 
Who is to-day the magistrate that has at his disposal 
in the smallest village a vast place to assemble the 
people, pronipt and sure means of convoking them, 
and a tribune for harangues to move or convince them ? 
It is the priest. He alone is master of the temple, the 
pulpit, and the bells; he assembles his flock at his 
pleasure, and without the permission of the civil au- 
thorities ; he orders and people obey. In the eyes even 
of the most unbelieving, Easter, Christmas, Whitsuntide, 
All-Saints day, and all the Christian feasts, are still holi- 
days, and the fasts are days of privation. Our streets 



POWER OF RELIGION. PRIESTS. MONASTERIES. 8 1 

and our cities bear names of saints ; the arts and the 
trades take saints for patrons. Despairing mariners vow- 
orisons to Our Guardian Lady. People mow on St. John's 
day ; they gather their vintage on St. Michael's. Now 
and then the irritated priest gives stern warnings ; now 
he covers our brow with ashes to teach us the vanity of 
human things ; again he refuses aid to the petitions 
of the heirs of a man who has died impenitent. He 
mounts the scaffold to guide penitent criminals to the 
bosom of divine mercy, and he frightens the timid young 
girl in regard to the consequences of some simple act con- 
fessed. He describes hell, and people tremble; he gives 
a glimpse of paradise, and they hope. When at times 
a bold unprincipled wretch steals his consecrated vessels, 
every one is aroused and grows indignant ; the guilty one 
is called an impious fellow and the crime a sacrilege for 
which expiation is due. In olden times, one would see 
the faithful prostrate themselves and fervently kiss the 
pavement of the temples, beseeching with tears, prayers, 
and fasting, pardon for these great crimes. 

This power of religion, so peculiar and so sudden, and 
the profound changes it caused in the social order, are 
especially manifest in the establishment of the monas- 
teries, which have raised and resolved so many ques- 
tions among men. In the East, the monasteries aimed 
at solitude and contemplation, to satisfy 'the desire to 
isolate one's self, to escape from pleasures and from hu- 
man relations ; in the West, on the contrary, they began 
in community life and the need of combining to render 
mutual aid. While society, a prey to general demoraliza- 
tion, no longer offered any centre of national, provincial, 
or municipal activity to elevated minds, the monasteries 
opened asylums for those who wished to live, think and 
discuss in common ; and they soon became the most ar- 
dent centres of the intellectual movement. It was here 
that originated those bold theological and philosophical 
opinions maintained with resources so ingenious, and 



82 HISTORY OF POLITICAL ECONOxMY. 

those trials of severe mortifications which gave new 
life to souls deadened by the regime of pagan civilization. 
An active correspondence and often keen contests arose 
between these various solitudes, already peopled like 
cities by the influx of all men whom liberty of thought 
and regularity in material life attracted to them. This 
was soon the way of those ambitious of attaining honors, 
and the sanctuary of literature, exiled from a world exclu- 
sively occupied with pleasures and sensualities. The in- 
habitants of these fortunate oases were not long in per- 
fecting in all ways the occupations necessary to maintain 
their independence and their preservation. The industrial 
arts, which, under the republic and in the first days of the 
empire, had been pursued at home by slaves for the profit 
of their masters, became to the religious communities a 
learned study ; they did not long live on dry fruits or 
vegetables ; they needed trades, and these trades were 
exercised with the same superiority which distinguished 
the newly constituted society in other matters. I do not 
doubt that this was the true source of the industrial cor- 
porations, whose organization has been attributed to St. 
Louis. St. Louis disciplined the societies of arts, but 
he did not create them. Their origin is involved with 
that of convents. It was from these that the industrial 
arts came forth free, to become established afterwards in 
the heart of the cities of the middle ages under the pro- 
tection of the principle of association. 

Another creation of Christianity completes the distinc- 
tion between it and all that social regime which is falling 
away, and that is, the precept of mutual benevolence put 
into practice and converted into a sacred obligation for 
all citizens. If there is anything which surprises us in 
Roman polytheism, it is that profound indifference to the 
sufferings of the poor and the grievances of the oppress- 
ed. There was in the old Roman society an impassable 
line of demarcation between rich and poor, between patri- 
cian and plebeian ; one might say that the latter was 



THE NEW CIVILIZATION BASED ON FREEDOM. 83 

fated to be the prey of the former, as in the animal king- 
dom certain species are predestined to be the food of 
others. Christianity brought these together by pre- 
scribing public and private charity, of which the Emperor 
Julian himself, that philosopher styled the Apostate, 
felt the imperious necessity. " Ought we not to blush 
for shame," said he,* " that the Galileans, those impious 
people, after having given food to their poor, take care 
also of ours, who were in absolute destitution ! " There 
the creation of hospitals, of asylums, of alms-giving, is 
indicated very definitely by the most formidable enemy 
of Christianity. 

What a step has political economy taken ! and if, since, 
that great mission of Christianity has not been more 
completely accomplished, if it has been given to other 
causes to arrest in its course the development of the sub- 
lime thought which invited all humanity to the banquet 
of life, without distinction of fortune and of caste, we 
have confidence that they will some day take their place 
there, and that the will of God will be done. 

Thus ancient civilization, wholly founded on slavery, 
was transformed, under the auspices of the Christian re- 
ligion, into a new civilization resting upon freedom. A 
part of that honor, however, belongs to the great geniuses 
of antiquity, Sokrates, Cicero, and those noble philoso- 
phers whose writings have survived the fall of Greece 
and Rome, and who had glimpses of the better destinies 
toward which we are progressing. Everything was still 
pagan in Rome and in the empire, when the Christian 
revolution was flagrant ; Lucian was turning the gods to 
ridicule at the very time when Christ was overthrowing 
their altars. A few capable slaves were emancipating in- 
dustry by force of talent, when religion came to extend 
to them her hand ; they were already compelling their 



* Nam turpe profecto est, cum impii Galilaei non suos modo, sed nostras 
quoque alunt, et nostri auxilio, quod a nobis ferri ipsis debeat, destituti 
videantur. Juliani Epist. 49. 



84 HISTORY OF POLITICAL ECONOMY. 

masters to have consideration, before the doctrine of 
beneficence and of equaHty before God had made it 
their duty to do so. So the transition from the old 
regime to the new is difficult to apprehend ; the most 
celebrated writers are lost in conjectures in treating of 
it, and one of the finest works which have been devoted 
to investigation in the laws, for the causes of that trans- 
figuration,* leaves much to be desired. 

When one recalls the glorious memories of the early 
days of Christianity and the grand details of that organ- 
ization so simple and so intelligent, he cannot refrain 
from a feeling of profound sadness, at seeing that religion 
to-day threatened with a serious decline. Unquestion- 
ably the structure, though undermined on every side, still 
stands and projects over the present the great shadow of 
the past : the services are solemnized, the temples are 
open, the hierarchy is the same ; but what a change in 
the fervor of the beliefs ! and how the parts have changed ! 
The priest no longer gives the impulse, he no longer 
knows even how to receive it ; he employs, in vain strug- 
gles against social progress, forces weakened by intoler- 
ance and by the shock of revolutions. He occupies the 
pulpits, but the pulpits are mute : their voice no longer 
thrills the heart of the people, as formerly when it led 
them in masses to the conquest of the Holy Places. The 
religion still exists, but it no longer has ministers who 
rise to the height of its needs and of ours. And, never- 
theless, in spite of our numerous attempts at political 
regeneration, no human constitution is yet like that of 
the church, no central power can make itself obej^ed like 
that: the misfortune is that there is no one who knows 
how to command worthily in its name. There are ques- 
tions of political economy which will remain unsolved 
until religion shall put her hand to them. Public instruc- 
tion, the equitable division of the profits of labor, prison 
reform, the advancement of agriculture, and many other 

* History of Roman Law in the Middle Ages, by M. de Savigny. 



PRIESTS NO LONGER LEADERS. IDEAL PRIEST. 85 

problems besides, will receive no complete solution ex- 
cept by her intervention, and that is justice ; she alone 
can, in fact, resolve the questions well, which she has 
well stated. 

Shall we be permitted to behold this so earnestly de- 
sired consummation ? We think not, although the re- 
hgious reaction which is everywhere manifest, appears to 
give hope of it. It is in effect a fine homage rendered 
by Europe to the sublime influence which formerly gave 
us the principle of all liberties; but that homage the 
priests have taken for a simple return to the old ideas, 
for a disavowal of progress rather than for progress itself ! 
— a fatal error, which is arresting the world in its course ! 
Strange blindness of a caste who persist in living outside 
of humanity, and drag themselves along after it instead 
of marching at its head ! Ah ! if the priest knew to-day 
of what an admirable metamorphosis he could be the 
instrument, and what a prodigious influence it depended 
on him to exercise over human destinies ! Hospitals, 
prisons, schools, workshops, public and private relations 
of nations and of individuals, agriculture, communica- 
tions, employers and workmen, everything would be 
within his province, all would willingly take as arbiter 
and guide a priest who was a civilizer after the fashion 
of the nineteenth century, a priest tolerant, enlightened, 
speaking a little less of the terrors of the other world than 
of the needs of this, and refusing to politics no longer the 
cooperation of his zeal and his devotion. People would 
soon remember that priests were a long time the first 
missionaries of civilization, and we should hear in the 
temples something else than declamations against the 
corruption of the age, and against luxury and wealth. 
The singular struggle which we witness, the pacific 
tendency of the world under a warlike attitude, would 
have already given place to the universal harmony to- 
ward which we are progressing, if the fine organization 
of Christianity had been represented by men in a con- 



86 HISTORY OF POLITICAL ECONOMY. 

dition to comprehend it and to preserve it. But I do 
not fear to say that the Christian religion to-day is as 
far from that influence, as the Roman polytheism was 
from its ancient power at the moment when Chris- 
tianity gave it the last blow. What has she done for 
Spain, for Portugal, and for South America, her most 
magnificent domains? What, in her hands, has unhappy 
Ireland become ? 



CHAPTER X. 

Economic consequences of the invasion of the Barbarians and of the dis- 
memberment of the Roman empire. — New elements introduced into the 
social organization. 

As the last rays of Roman power became extinct in 
that wave of corruption, cowardice, and weakness which 
finally engulfed the empire, the Barbarians appeared in 
the horizon to have a share in the wreck. In fact, 
they had for a long time kept up secret communi- 
cation with persons in the heart of that immense em- 
pire, the governors of which had committed the folly of 
entrusting to them its protection. There were more Bar- 
barians than Romans in the legions which guarded the 
frontiers ; and when they began their march to conquer 
the empire, rations were all that was needed to conduct 
them over its territory, exposed on every side. However, 
before reaching the goal of their conquest, they had a 
long journey to make: this journey lasted more than a 
hundred years. The fathers had set out ; the sons alone 
arrived. What were these men? Whence came they? 
What impulse were they obeying, when they untiringly 
advanced over the ruins of the Roman world in such a 
cohort that we cannot clearly distinguish their true names 
and their mysterious native land ? What appears certain 
is that they came from a region where slavery was un- 
known * and liberty indomitable; for they made their 

*The illustrious author of the Etudes Hisioriques sur la Chute de V Em- 
pire domain, Chateaubriand, (vol iii, p. 146), thinks that the Barbarians 
were acquanited with slavery. If he says this because by virtue of the right 

87 



88 HISTORY OF POLITICAL ECONOMY. 

chiefs pass through rough ordeals, and were not greatly 
unlike those Arabs of the Atlas, in Africa, with whom 
we have recently been made acquainted. 

When they presented themselves on the frontiers, al- 
most all on horseback, followed by their beasts and their 
tents, there was among them only one law, force ; only 
one passion, the desire to use it. They found the empire 
occupied with philosophical, theological and political dis- 
cussions, and they had not much difficulty in making 
chose legions of doctors who reasoned instead of fighting, 
flee before their frameas' (javelins of the ancient Franks. — 
Trans.) instead of fighting. Their singularity even, their 
strange costume, their odd and horrible weapons, all 
contributed to spread terror on their path ; and the 
Romans of the decline were not less frightened at their 
approach than the inhabitants of Mexico were a thousand 
years later at the sight of the soldiers of Fernando Cortes. 
They were a new race in all the force of the term ; robust, 
intrepid, lofty, who returned with usury the contempt 
with which the Romans had constantly treated them. 
One should read in contemporary histories the de- 
scriptions they have left us of the character of these 
people ; by the frightened air with which they speak of 
them, it is easy to see what an effect of profound stupe- 
faction their appearance had just produced. Tacitus 
seems to have been seized with a prophetic presentiment, 
when he related the massacre of the legions of Varus. 

// was written, however, that civilization should pass 
through these wild hands, to get rid of the impure var- 
nish with which it had been covered during the decline of 
the empire. From the very moment when barbarism 
advanced to the encounter with the ancient world, one 
sees the metamorphosis commence : slavery grows weak, 

of war, they imposed it temporarily upon the conquered, no one questions 
it ; but tliey had not, like the Romans, markets for human beings. Their 
slavery did not at all resemble that ; more than this, it was not slavery, in the 
true acceptation of the word, otherwise liberty could not have sprung from 
it. 



TRANSITION PERIOD. CODES OF BARBARIANS. 89 

because people no longer come from the country of 
slaves. They are more costly ; people treat them as a 
rare thing, or perhaps employ them as a defence. In pro- 
portion as the power was lost of renewing them by con- 
quest, and their numbers could only be increased by their 
own fecundity, they became members of the Roman 
family ; they lived in a condition nearly like that of 
our domestics, and their masters insensibly lost the habits 
of despotism which attach to the idea of property. Thus 
was brought about the transition from slavery to serfdom, 
two regimes very different, since the former enfeoffed 
man to man, and the second simply bound him to the 
soil. Everything on the contrary seemed favorable to 
liberty in the codes of the Barbarians; the division of 
property between children of the same father, was made 
in equal portions, and if any preference was permitted, it 
was in favor of the youngest, that is to say, the weakest. 
They especially protected the person from damage, for 
their penal laws seem rather for the protection of man 
than of property. The horse alone, the companion and 
the instrument of their independence, participated some- 
what in the protection accorded to man ; there were heavy 
fines for simply mounting him without permission. The 
chase was subject to laws, and the forests were placed 
under the safeguard of all, as the common asylum and 
the bulwark of liberty. 

There were fines for wounds made through violence or 
by carelessness ; so much for four teeth broken, so much 
for an eye put out, so much for the thumb-nail or for the 
membrane of the nose. The penalty of death was rare, 
and these men, so harsh, were more sober than we. Noth- 
ing is more surprising among them than the uniformity 
of rules, or, if one may say so, of principles, notwithstand- 
ing the diversity of their origin ; for some came from the 
north, others from the south and east : one might say 
that in giving themselves a common rendezvous, they 
had made an exchange of habits and had prepared a 



90 HISTORY OF POLITICAL ECONOMY. 

pass-word. " I had a passion for effacing the Roman 
name from the earth," said Ataulf, the successor of 
Alaric, at the time when the vanity of the Romans 
treated their conquerors as generals in the service of the 
empire. Rome was disappearing before that civihzation 
come from the woods, and she thought herself still 
reigning, even when she was ceasing to exist. The little 
regard thdt her conquerors kept for her was accorded to 
a power which conspired with them for her ruin, and 
which aided them to achieve it. This power was the 
Christian Church. The Christian Church met the Bar- 
barians on the route to the conquest of the pagan world, 
and offered itself to them as an auxiliary : it was ac- 
cepted. It had an organization already made, an estab- 
lished hierarchy, sympathies already old in the hearts of 
the people, and it appeared as an intelligent arbiter in 
the midst of those confused cohorts who knew how to 
proceed only by fire and sword. Disorder had indeed 
succeeded in reconciling itself with invasion ; it would 
never have been able to subsist with a regular establish- 
ment. The Church had already taken possession of the 
municipalities ; the Roman commune had been trans- 
formed into a parish of which the church-wardens might 
be considered as the administrators. Such were the first 
rallying points of the new system, and we have the evi- 
dence of it when Alaric, after having obtained possession 
of Rome, caused the sacred vessels of the Christians to 
be placed in safety, escorted by a double row of Romans 
and Goths, with sabres in their hands and chanting 
hymns in praise of the Anointed ! * 

There were, in fact, numerous points of contact, not- 
withstanding their dissimilarity, between the doctrines of 
the Christian church and the habits of the barbaric 
regime. Everything was elective among the first Chris- 
tians as among the Germans : the assemblies of the 
faithful, either in the temple or in council, deliberated 

* Orosius ; Hist. Book vii, chap, xxxix. 



BARBARIC INVASION. CHRISTIAN CHURCHES. 9 1 

on the affairs of religion, as the Barbarians deUber- 
ated in those assemblies at once parliamentary and 
military, which were transformed later into periodic 
May assemblies. A little after, the priests took the 
guidance of those men of imagination who needed at 
the same time to be incited and to be directed. It was 
the hand of religion alone which arrested those arms so 
indefatigable that a full third of Europe had succumbed 
to their strokes. Pestilence, famine, fire, served them as 
attendants ; cities fell by thousands, as if overthrown by 
earthquakes. " If the ocean had inundated the Gauls," 
isaid a poet, " it would have caused no more terrible 
ravages than that invasion. In the East, the neighbor- 
hood of Constantinople had not less to suffer from that 
frightful cataclysm ; the sun soon disappeared under the 
brambles, and the animals even seemed to have quitted 
the woods." To whatever part of the old Roman do- 
minion one turns his eyes, the same spectacle is pre- 
sented before him ; Sicily, Spain, Africa, Great Britain, 
are invaded. Torrents of Barbarians roll their devasta- 
ting waves over these fine countries, and cause not only 
their monuments, but all the resources of industry and 
all the traditions of the ancient arts, to disappear. 

From this chaos the new civilization was to rise. All 
the Roman world was obliged to pass through this test 
before experiencing a complete renovation, as those old. 
cities which rise again more beautiful after a fire. At 
the first moments of the awakening, the change was al- 
ready visible. There were no longer any pagan temples, 
and everywhere arose Christian churches, flanked by 
monasteries where pious cenobites gathered in silence 
what was left of the sciences and the arts. The solitudes 
were peopled with unfortunates who fled from the spec- 
tacle of public desolation, and who imposed on them- 
selves privations worse than those of the world they had 
just left. They thus grew in public esteem, and around 
them flocked a crowd of admirers who ardently propa- 



92 HISTORY OF POLITICAL ECONOMY. 

gated the doctrine of the separation of spiritual from 
temporal power. 

The church thus laid in the presence of the sword the 
foundation for independence of thought ; happy if, after 
having founded this independence against barbarism, it 
had not one day endeavored to stifle it in the interest of 
despotism ! The Barbarians had indeed a remarkable in- 
clination to exercise this independence. We have noth- 
ing in modern times, unless perhaps the character of the 
North American tribes, to be compared with the habits of 
these new men, for whom the open air, a wandering life, 
the absence of restraint, even at the price of a thousand 
dangers, seemed an inexpressible felicity ; and yet we 
have inherited from them many virtues and many vices 
which have by degrees penetrated our society without our 
being able clearly to trace them to their source. 

Let us render thanks, however, to that Barbarian influ- 
ence, in virtue of which, personal dignity, I might almost 
say the generous susceptibility of man, resumed its sway, 
after coming forth from the long oppression in which it 
had languished under the oriental yoke of the Roman 
emperors. If a hierarchy and subordination are fine ele- 
ments in the social order, individual liberty is an element 
not less worthy of respect ; and although it has come to 
us closely following the Barbarians, we must neve'rtheless 
recognize the immense service they rendered us in bring- 
ing it. They thus prepared the emancipation of tPie la- 
borers and an end of the exploitation of human beings, 
by favoring the mingling of castes previously irreconcil- 
able, and by subjecting them for the time to a common 
oppression. We cannot comprehend how enlightened 
minds could see in these facts so simple and so evi- 
dent, the justification of a theory condemned in advance 
by observation and experience. What, for example, shall 
we think of those who have divided European nations 
into two castes, one of which includes the posterity of 
the conquerors and the other that of the conquered? 



BARBARIAN AND ROMAN CIVILIZATION CONTRASTED. 93 

And who to-day could seriously maintain that the 
church should be forever the mistress of the world, be- 
cause it temporarily ruled its masters? Twelve centuries 
have passed over the mingled dust of those generations 
so different in origin, and if reconciliation is not yet com- 
plete between the children of so many dead, it is every 
day being brought about more and more on the altar of 
civil equality and at the hearth of association of labor. 

The contrast was striking between the social habits of 
the Barbarians and the Roman civilization with which 
they were coming to mingle. They were nearly all en- 
camped in villages, leading a pastoral and agricultural 
life, when they set out for the conquest of the Roman 
world, which they found almost entirely established in 
cities. Great as was the decline of the Roman power, its 
organization still subsisted and the wheels of administra- 
tion still performed their functions, notwithstanding the 
general enfeebling of politics. There was in all the cities 
a local hierarchy still respected, when the first wave of 
the Barbarians reached their walls. Who can say what 
were the sensations of these irregular hordes, at the sight 
of the regular and methodical order of the great Roman 
cities which were frightened at their aspect ? The Cos- 
sacks entering Paris in 18 14 on their horses covered with 
skins of beasts, could not have been more astonished at 
the spectacle of our civilization. By degrees, as the in- 
vasion extended, these conquerors became proprietors ; 
they seized a multitude of rural domains, and either from 
sympathy for their former rural habits, or from disdain 
for a city residence, they established themselves in prefer- 
ence in the country, which they were not long in covering 
with villages. From this position, they kept the cities in 
awe ; and they thus laid the foundation for the suprem- 
acy of landed property. The Gallic, Batavian, Italian 
and Spanish peasants that they found scattered about, 
fell under their immediate yoke, cultivated the fields for 
them, and were their colonists before being their serfs ; 



94 HISTORY OF POLITICAL FXONOMY. 

then, the need of defending themselves against each 
other, perhaps also against the sedition of the cities, 
transformed the cottage into a castle-keep and the village 
into a fortified camp, avant-couriers, as it were, of the 
feudal system. 

Thus these purely military chieftains, after having taken 
as their share of the booty vast portions of land, the 
sources of great revenues, became accustomed to wealth, 
and forced their subordinates to labor and tribute. Their 
contact with Roman customs contributed daily to modify 
the prejudices they had brought with them from the 
depths of their forests ; they forgot their own manners, 
or they modified them under the influence of the people of 
the cities. They were no longer pure Barbarians, since 
they had made a halt in the midst of a world which was 
assimilating them to itself on every side. If the fusion 
had taken place suddenly and without other shock than 
the arrival of the conquerors, the change would not have 
cost humanity so much blood and so many tears ; but 
Heaven willed that, having no more enemies to con- 
quer or people to subjugate, they should rend each 
other. It was not the first invasion that was the most 
fatal ; it was the second, it was the third, it was the 
fourth : it was that series of new tribes which pressed 
upon each other and disputed with each other the lost 
and silent wreck of the Roman world. The Franks, 
the Visigoths, the Burgundians, who occupied vast por- 
tions of our territory, did not penetrate it all together, 
and they established themselves in it on very different 
bases. Opinions were often quite opposite at the court 
of Toulouse, that of Lyons, and that of Soissons, if it 
is allowable to give the name of courts to those general 
quarters of conquest ; but one general idea dominated 
in them all, namely, that leisure was a sovereign right, 
and that labor was the exclusive lot of the conquered 
and of men without property. It must be acknowl- 
edged that the Romans had singularly prepared the way 



FINE ARTS AND INDUSTRIES ABANDONED. 95 

for that transition, by the manner in which they had 
continually treated the subject nations. When the Barba- 
rians came, they had only to take the place ; it was all 
ready for them, and was yielded to them without resist- 
ance. 

What, during all this time, became of manufactures, 
and the arts, and the Roman institutions, the system of 
taxation, the commercial habits of the world and its 
great markets, Africa, Spain, Asia-Minor, Sicily and all 
Italy ? A profound revolution suddenly was manifest 
in them, and destroyed at once the great centres of in- 
telligence and rational progress. All of Greek and Ro- 
man philosophy which Christianity had turned aside to 
its advantage, all those schools which it had recast and 
animated with its spirit, disappeared before the exigen- 
cies of conquest, until the new religion had conquered 
in its turn all the conquerors, and had made them serve 
for the triumph of its destinies. In material order, there 
was also effected a great and sudden change ; the fine 
arts, if not proscribed, were at least abandoned as super- 
fluities. The gigantic constructions, the bold enterprises 
which inflamed the enthusiasm of the Romans, even at 
the time of their greatest decline, almost suddenly ceased. 
Of what use henceforth were those graceful forms in fur- 
niture and domestic utensils, those statues, those elegant 
fabrics, to half-savage consumers who could not appre- 
ciate their use, and would not be willing to pay for the 
workmanship? The abandonment became such, that 
most of the industrial secrets were lost, and several have 
never been rediscovered. A few artisans preserved in 
their workshops the transmission of the most indispensa- 
ble trades : but between Roman art and Christian art 
there is nothing. No sensible transition binds the tem- 
ples of paganism to the piles of the new worship, and 
one cannot recognize an intermediary character in those 
heavy and shapeless rudiments of the purely barbaric 
period, which have no name in any language. To find 



96 HISTORY OF POLITICAL ECONOMY. 

again something grand, something truly noble and ma- 
jestic, we must wait until the Christian people have suc- 
ceeded the Roman people by stripping off the Vandal 
bark. 

One cannot, however, deny that the barbaric invasion 
brought notable changes in the social constitution of Eu- 
rope. It simplified Roman legislation, which was encum- 
bered with texts and had become inextricable by reason 
of subtilties. It even permitted the conquered peoples 
to adopt or reject the new regime, on condition of profit- 
ing by the advantages which it presented to them, or of 
being deprived of them, according to the resolution which 
they should adopt. Thus the Salic law decreed that the 
life of a Roman was less valuable than that of a Barba- 
rian — a cruel insult of the conqueror, of which we only 
find the corrective in the ripuary* law, which placed 
the members of the clergy above the dominators them- 
selves. Insensibly this influence of the church mani- 
fests itself so efficaciously that the Barbarians consent 
to abandon their titles, and to substitute for them the 
Latin names of dukes, counts and prefects. For the 
exact and circumstantial evidence required by Roman 
jurisprudence, they substitute the religious tests by fire 
and water, and soon after, single combats, which latter 
bad practice we have kept. What testimony to their 
victory and their sovereignty could be stronger ! Since 
God directs the issue of national wars and gives the palm 
to the most just side, why should we not consult him 
by appeal to arms in private affairs? That is what 
they said, convinced that, in their private quarrels, the 
Romans would not attempt, as individuals, a struggle in 
which they had so badly succeeded as a nation. Thus 
that fatal innovation introduced into human disputes a 
deplorable element of which future generations were long 
to suffer the consequences. 

The portion of the conquered lands which the Barba- 

* Book vii, chap, xi, law 36. 



CHANGES RESULTING FROM THE CONQUEST. 97 

rians had adjudged to themselves gave rise to vexations 
of every kind, and continued, under new forms, the sys- 
tem of usurpation which the Romans had pursued 
wherever their armies had advanced. Artisans were no 
longer free to work for themselves ; they were adjudged 
by the right of war to the chiefs of their conquerors ; and 
the latter, surrounded by blacksmiths, carpenters, shoe- 
makers, tailors, dyers, and goldsmiths, added to the rev- 
enues of their lands the profits of the labor of these 
workmen. It was still Roman servitude, with this differ- 
ence, that formerly the Romans worked others for their 
own advantage, and now they were worked for the ad- 
vantage of others. Civilization must have lost by this 
change, if later a powerful hand had not organized the 
scattered elements of the new social order, by associating 
Roman intelligence with Vandal force, and bending the 
somewhat savage independence of that force to the re- 
gime of constraint and to respect for law. This great re- 
former was Charlemagne. 

The essential and characteristic fact of the invasion of 
the tribes designated under the name of Barbarians, was 
their passage from a wandering and conquering state to 
the condition of proprietors. The manner in which they 
distributed among themselves a portion of the conquered 
territory, each tribe according to its native habits, brought 
about serious modifications in the system of property, 
without notable amelioration in the fate of the cultiva- 
tors.' We find, in the laws of the Visigoths and the Bur- 
gundians, that these two tribes had two-thirds of the 
lands : * the Franks did not follow the same plan, but 
took what they wished. However, they did not take all ; 
and the Burgundians had not even exercised their right 
of conquest over the whole of the disposable lands, since 
it was stipulated in a supplement to their law f that not 



* Montesquieu, Espiit des Lois. Book xxx, chap. 8. 

f Ut non amplius a Burgundionibus qui infra venerunt requiratur quam in 
praesens necessitas (fuerit,) medietas terrre (art. xi.). 



98 HISTORY OF POLITICAL ECONOMY. 

more than a half should be given to. those who should 
afterwards come into the country. For a long time, each 
Barbarian established himself as a boarder upon a Roman, 
as the Athenians formerly did among their conquered 
peoples, and as the Romans, in their turn, had done 
among the nations of which they had become masters. 
Thus property changed hands, but the Greek and Roman 
system of living at the expense of another, still con- 
tinued, and in this respect there was no change, except 
that barbarism took its revenge at the expense of its 
former oppressors, henceforth the oppressed. From 
whatever point of- view one looks at that rude transition, 
he does not yet perceive the germ of a decisive economic 
revolution. The new territorial aristocracy is distinguish- 
ed from the old proprietors of latifundia only by less ele- 
gant and less polished manners ; but at the bottom, the 
cruelty is equal in the two classes : — the new beat their 
servants themselves ; the old, better reared, had them 
beaten by others : that is the difference. 

The Roman world was so strongly impregnated with 
these ideas of servitude and of despotic hierarchy, that 
the Barbarians had, so to speak, only to substitute their 
titles for those of the imperial administration. The per- 
sons employed were almost all the same ; the power flowed 
in the same channels. The Roman middle class had given 
place to the etat major of the Barbarians ; and, save the 
consequences which ensued from that substitution, the 
revolution which took place might have passed for a 
simple change of public functionaries. But soon the 
conquering chiefs accorded exemptions from taxes, 
granted domains and life-benefices, which the successive 
encroachments of their subordinates at last made heredi- 
tary. Distinctions penetrated civil society to the vitals ; 
there were lands free from taxes, Salic and allodial \ 
whose proprietors gradually arrogated to themselves 
rights over the neighboring inhabitants, and became 
under the title of seniores or lords, veritable tyrants. 



NEW ELEMENTS IN THE SOCIAL BODY. 99 

The chase, of which they were passionately fond, was 
considered by them as a right interdicted to peasants. 
It was more dangerous to kill a stag or a boar than to 
make away with a man. Nevertheless, not all these vexa- 
tious acts were legalized, and never was there, to speak 
correctly, any edict for general confiscation. When that 
abuse of power was inscribed in the laws, it had a long 
time figured among accomplished facts. The clergy every 
day mitigated its rigors by their influence over the de- 
positaries of force ; entirely composed of natives, men 
able and shrewd, they neglected no occasion to make the 
lofty head of the dominators bend under the religious 
yoke ; they taught them Latin, corrupting it doubtless ; 
but in the end it facilitated their means of entering into 
more intimate communication with laws and customs 
which were, in the long run, to have influence over 
them. . ' 

One circumstance, justly noted by historians as very 
important, contributed much also to prevent the German 
invasion from taking entirely the place of the preceding 
regime. The Barbarians had the habit of assembling in 
their woods and swamps around the persons of their 
chiefs, who took counsel of the general assembly, and 
deliberated with it before acting. When they were 
scattered and located upon the conquered territories, 
they presented themselves with less punctuality at the 
assemblies, and the authority of the chiefs no longer 
extended beyond a limited radius. More than one Bar- 
barian entered the sacred orders and carried there his 
intemperate habits ; questions of doctrine were often 
decided by force. In Spain, the Visigoths, under the in- 
fluence of the councils, caused several codes of laws to 
be drawn up, which were a compound of Roman princi- 
ples and religious prejudices. In England, the irruption 
of the Saxons found the inhabitants abandoned to them- 
selves, and their establishment there. became decisive 
only after a struggle of more than a hundred years. 



lOO HISTORY OF POLITICAL ECONOMY. 

For a long time that famous island seemed effaced from 
the map, and was regarded as a mysterious land, of which 
all sorts of prodigies were related. When it was discov- 
ered for the second time, everything there had changed ; 
seven independent kingdoms had been formed, and al- 
though constantly agitated by discord, they had made 
even the last vestiges of Roman supremacy almost en- 
tirely disappear, A new political order had just arisen. 
Gaul and Spain had been divided between the two pow- 
erful monarchies of the Franks and Visigoths ; Africa 
was a prey to the Vandals strictly so called and the 
Moors. Italy was subject to foreigners ; traces were no 
longer to be seen of Roman majesty, save in the Eastern 
Empire, which extended still from the banks of the 
Danube to the borders of the Nile and the Tigris. Out- 
side of that, a multitude of new nationalities had been 
formed ; we shall soon witness the development of their 
social state. 



CHAPTER XI. 

Last rays of civilization at Constantinople under Justinian. — That emperor 
makes a summary of all the legislation of the Romans.— Character of his 
Code. — The Pandects. — The Institutes. — The laws of Justinian are the ar- 
chives of the past ; the Capitularies of Charlemagne, the programme of the 
future. 

Between the new order of things emanating from the 
barbaric invasion, and the expiring civilization of Rome, 
there is an intermediary epoch worthy of interest to the 
economist, though not characterized by any of those 
profound changes which overthrow the social system of 
an entire people. This epoch is the reign of the Eastern 
emperor Justinian ; a memorable reign, which had no 
dawn and will have no twilight ; a veritable communica- 
tion thrown between two worlds, the one of which is 
ending and the other beginning. It seems, in study- 
ing it, as if the genius of ancient civilization had wished 
to make its testament and had enveloped itself, like the 
chrysalis, in a tomb of silk and gold, before undergoing 
a last transformation. Everything is summed up and 
collected, laws, arts, manufactures, agricultural pro- 
cesses. For the first time a raw product, silk, becomes 
the subject of imperial solicitude and weighs in the 
political balance, like cotton, sugar, and tea, in our 
times. Monopolies are established for the benefit of 
the public treasury ; moneys are debased, offices are 
sold. We do not admire this, but we take note of 
it as the first indication of a systematic political econ- 
omy. In the sciences even, bold experiments testify of 



I02 HISTORY OF POLITICAL ECONOMY. 

the movement which is taking place ; burning glasses, 
explosive powders, pumps for irrigation, are tried. Medi- 
cine abandons its old vagaries and architecture raises its 
first dome in the air.* Palaces and temples arise on 
every side ; aqueducts, bridges, hospitals, are erected 
in nearly all the cities ; there seems to be haste in multi- 
plying the monuments of the arts, lest barbarism come 
too soon and interrupt their completion, and in the hope 
that they will survive it. From Belgrave to the Euxine, 
and from the confluence of the Save to the mouth of the 
Danube, a chain of more than eighty fortresses rises to 
protect the banks of the great river ; one would say that 
Rome was laymg down her final boundaries, and, weary 
of conquests, was at length establishing herself in an en- 
trenched camp. But while Rome is thus providing her- 
self with battlements in the East, where letters and arts 
will soon take refuge, the rest of Europe is submitting to 
the law of the conqueror, and Latin institutions are 
everywhere supplanted by barbaric customs. The Ger- 
man graft applied to the old Roman trunk is beginning 
to bear fruit, in which there still remains somewhat of 
the savor of the first tree. To that cohort of devastating 
chiefs, whom frightened Christianity dreads and baptizes, 
succeeds at length a great man, the true representative 
of the new social order, who shows as much solicitude in 
restoring civilization as his coarse predecessors manifested 
in destroying it. I mean Charlemagne, the first prince 
of the race of vandal conquerors, whose reign sums up 
the thought of those four or five centuries of invasions. 

The contrast of that thought with that of the Roman 
emperors nowhere appears in a more striking manner than 
in the double enterprise of Justinian and Charlemagne. 
In fact, these two princes each left a monument more 
lasting than the memory of their victories, viz., the Pan- 
dects and the Capitularies. I know no subject for study 
more fruitful or more vast than these two great codes of 

* The Church of St. Sophia, at Constantinople. 



JUSTINIAN CODE. PANDECTS. INSTITUTES. I03 

two great sovereigns, one of whom so well represents the 
setting and the other the rising sun. It is there that 
political economy must seek the condition of the people 
at the two extremities of Europe, when Roman civiliza- 
tion withdrew to Constantinople to give place to the 
almost universal rule of him who put on his head the 
crown of Germany, of France and of Italy. Thus has 
Napoleon's code survived his victories, and it will some 
day do more honor to his memory than the most mag- 
nificent monuments of his reign. There, will be found 
the most important social facts of his epoch, as we find 
in the laws of Justinian the clearest traces of the col- 
lective wisdom of the Romans. 

All these laws were brought together as a whole for 
the first time under the reign of this prince, into three 
distinct books, the Code, the Pandects, and the Institutes. 
When he ascended the throne, the jurisprudence was en- 
cumbered with a confused multitude of texts, the simple 
nomenclature of which would have been beyond human 
power. Fate gave him as an auxiliary the famous Tri- 
bonian, who introduced order ajnd light into this chaos 
and who finished in less than fifteen months the revision 
of the ordinances of his predecessors. This first work 
was called the Justinian Code and promulgated through- 
out the empire with unwonted ceremony. Seventeen 
jurisconsults, under the direction of the same learned 
man, afterwards prepared in three years the Pandects, a 
colossal compendium of two or three millions of sen- 
tences, and which had been preceded by the publication 
of the Institutes. Thus the elements of Roman law were 
followed by the explanation of its jurisprudence, and 
justice could at length consult the eternal oracles,^ with- 
out fearing to lose herself in a labyrinth of laws. Un- 
fortunately the oracles were liars, as almost all are ; for 
in collecting the laws, care was taken to adapt them to 
contemporary customs. Tribonian became an accomplice 

* This is the name that Justinian gave to his Codes. 



I04 HISTORY OF POLITICAL ECONOMY. 

in the alterations which were to bring the code of a re- 
pubhc into harmony with the despotism of an absolute 
monarchy. At the same time, in order to prevent the 
code thus amended in the interest of despotism, from 
suffering in future any change which might be to the 
advantage of freedom, the emperor forbade, under the 
penalty due to forgery, the least commentary on the new 
text. A few years later, he caused another edition of it 
to be made, augmented by the novelldB (recent enact- 
ments), v/hich complete the imposing structure of his 
jurisprudence. 

One finds in the collections of Justinian very valuable 
details on the condition of persons at Constantinople 
towards the middle of the sixth century. Although the 
citizens were, nominally at least, equal before the law, 
there were no longer any rights connected with this title 
formerly so honorable and so eagerly sought after. Freed 
slaves obtained it without transition, and that facility con- 
tributed not a little to the abolition of domestic servitude. 
The authority of masters over slaves was also considerably 
restricted. The right of life and death accorded to fathers 
over their sons, was abolished, and the latter could acquire 
some kinds of property, which ceased from that time to 
belong to the authors of their being. The abandonment 
of children, long tolerated as excusable, was punished as 
a crime when the death of the victims followed ; some 
restrictions were put upon liberty of divorce, which had 
degraded marriage to the vilest concubinage ; * and the 
influence of the church was already plainly manifest in 
the list of causes, which, on the part of man or woman, 
could give rise to a separation. Religion had already 
penetrated jurisprudence. One principally notes its inter- 
vention in the care with which the rights of orphans and 
of minors were protected. 

* Saint Jerome saw at Rome a husband who was burying his twenty-first 
wife. The latter had buried twenty-two of his predecessors, less robust than 
he. Seneca said of the women of his time: " non consulum numero, sed 
viaritorum annos suos computant" De Benejiciis, iii, l6. 



PROPERTY. LEASES. RATE OF INTEREST, 105 

So much for persons ; but property was not forgotten. 
The Institutes contain on this subject a multitude of 
remarkable provisions. They admit the principle of 
inheritance of property, in its freest extent. There is no 
prerogative of primogeniture ; no distinction as to rights 
of succession, between boys and girls. On the extinction 
of the direct line, the property passed to the collateral 
branches. Wisely composed prescriptions conciliated all 
interests and left little occasion for law-suits. The lengthy 
details occupy twelve books of the Pandects. Books 17, 
18, 19, and 20 of the same collection contain also very 
remarkable provisions in regard to loans, contracts for 
leasing property, and the nature and conditions of leases 
for a term of five years. The rate of interest was fixed 
at 4 per cent for persons of illustrious rank and at 6 per 
cent for all others : this was the ordinary and legal 
rate. Nevertheless, 8 per cent interest was permitted to 
manufacturers and traders and 12 per cent for maritime 
insurance. The clergy, more strict or less enlightened, 
always condemned loans at interest, which Saint John 
Chrysostom and the fathers of the Church assailed with 
their feeble arguments, and which Shakspeare, later, 
called, in his vivid language, the posterity of a sterile 
metal. 

Meanwhile, notwithstanding these improvements in the 
revision of the laws, compared with what they were pre- 
viously, the people derived less advantage from them 
than might be supposed. Although the laws had been 
reduced to forms more simple and terms more precise, 
there still remained enough that was vague and contra- 
dictory to support hosts of advocates and legists. The 
residence of litigants in remote provinces involved tedious 
delays, uncertainties, and considerable expense, whenever 
there was an appeal to the highest judicial authority. 
Roman law became again a mysterious science which the 
industry of the practitioners, worthy masters of those of 
our day, exptoited with unparalleled audacity. The rich 



I06 HISTORY OF POLITICAL ECONOMY. 

mercilessly crushed the poor, and the costs of the suits 
uniformly consumed the amount in controversy. Never- 
theless these forms and these delays, although very ex- 
pensive, protected person and property against the ca- 
prices of tyranny and the arbitrariness of the judge, and 
that was some progress. How many reforms adapted to 
the present time and bearing deeply its impress, that 
single revision of the Roman laws contained ! Who 
could have told that after more than twelve hundred 
years, these laws would still, in most of their provisions, 
direct the administration of a society so different ? But, 
in this long passage through the centuries, they were to 
become penetrated with the spirit of many new institu- 
tions and to furnish to a great man the elements of a 
legislation which shared his glory if it did not his origin- 
ality. 



CHAPTER XII 

Political economy of Charlemagne. — Analysis of the economic part of his 
Capitularies. — Singular details contained in the capitulary /)<? Villis. — Social 
consequences of the reign of this great man. 

The reign of Charlemagne forms the transition between 
barbarism and feudalism. He reestablishes unity of 
power and of territory, alike broken by that host of 
petty sovereigns and petty states which fill all the period 
since the first invasion. The kingdoms of Metz, Or- 
leans, Soissons, Paris, Aquitaine and Burgundy become 
absorbed in the great imperial monarchy ; and all these 
miserable despotisms, unfitted to conceive great ideas, 
are swallowed up in a single one capable of carrying^ 
them into execution. For the first time since Caesar, 
the conqueror and organizer, a man appears, worthy of 
leaving his name to his age. What especially character- 
izes this remarkable man, is that he was a true Frank of 
France, the least commingled with Roman blood that 
had yet ascended the throne. Almost all his predeces- 
sors, Barbarians or not, had received the Roman and 
Christian impetus ; he felt himself strong enough to give 
it. The others had reigned : Charlemagne determined 
to govern. He might perhaps have prevented the ad- 
vent of the feudal system, by powerfully restraining the 
aristocratic tendency of his time, if his weak successors 
had not let his work perish, and surrendered to chance 
the destinies of humanity. 

His fifty-three expeditions were directed by a political 

107 



I08 HISTORY OF POLITICAL ECONOMY. 

idea that seemed lost since the Romans. What he 
determined, first and foremost, was to reestabhsh in 
Europe a great power, strong enough to restrain all 
ambitions and to subject them to a common domination. 
He made war on threatening independencies and hostile 
beliefs, and only stopped when he had attained his prin- 
cipal aim, which was to make an empire. In the North 
and the South he encountered two great opposing 
powers, the Saxons and the Arabs: he conquered them 
both. Unfortunately, his victories left him scarcely suffi- 
cient leisure to organize, and he encountered fewer diffi- 
culties in war than in peace ; but, although his great 
works did not survive him, the impulse that he had 
given to Europe had been too strong for the movement 
to be arrested. Europe did not again become, after his 
death, such as it had been before his reign : he had given 
it an idea to be revealed in the acts of his successors, in 
the politics of the states formed from the dismemberr 
ment of his monarchy, in the wars even that they make 
upon each other or maintain against their enemies. 

It suffices to recall the pains with which he endeav- 
ored to reestablish a strict administrative hierarchy, 
watched over by ambulant inspectors, inissi dofninici, 
sent by the master, charged with rendering to him an 
account of the state of the provinces, of the reform of 
abuses and the execution of his orders. He was thus 
present everywhere, and he could extend his hand even, 
to the extremities of his empire with decisive rapidity 
in those times of tedious delays and over that immense 
surface almost entirely destitute of roads. The thirty-five 
general assemblies held under his reign, although they re- 
semble scarcely at all our modern parliamentary sessions, 
nevertheless contributed important aid to the ameliora- 
tions which he effected. It appears that the deputies 
had only an advisory voice in them : the emperor made 
his decisions in spite of their opposition ; but in these 
sessions he received valuable communications on the 



ORIGIN OF THE CAPITULARIES. IO9 

condition of his country, its needs and its sufferings. 
Archbishop Hincmar has left us curious revelations of 
the manner in which these general assemblies were con- 
ducted and the origin of the Capitularies which sum up 
their labors. " It was," he says, " a custom of that time 
to hold every year two assemblies, in which, by order of 
the king, the articles of the law, called capitula, which 
the king himself had prepared by the inspiration of God, 
were submitted to the nobles." 

There was, then, a preliminary examination, a discus- 
sion in State Council, for we can recognize no other 
character in these pacific assemblies whose debates were 
directed by the sovereign, in virtue of the wisdom which 
he had received front God, to use the expression of his 
historian. Charlemagne should then have only the more 
merit in our eyes, since the dominant thought in all the 
improvements of his reign belongs exclusively to him. 
And certainly, never was activity more extraordinary 
than his; although his numerous wars forced him to 
transport himself many times from one end of Europe 
to the other, he constantly published reform edicts on a 
multitude of subjects, sometimes so minute in detail, 
that we can hardly comprehend how the majesty of his 
power could descend to them. It is then in his Capitu- 
laries that we must look to ascertain what his political 
economy was, and whether it is true that this science 
owes to him anything essential. And first let us call 
attention to the fact that people have erroneously at- 
tributed to Charlemagne alone the collection of apho- 
risms, opinions, prescriptions and laws which bear his 
name. Nearly half belong to his predecessors, and a 
great number to his successors. The title of the work 
{Capitula regum francorum) is alone sufficient to indicate 
the true signification and exact nature of its contents. 
The best edition that we possess* is only an undigested 
collection, without order, without critical notes, and 

* That of Baluze, in two folio volumes. Paris, 1677. 



no HISTORY OF POLITICAL ECONOMY. 

whose text, written in the bad Latin of the decline, dis- 
courages the most intrepid students; but it is an inex- 
haustible mine of valuable documents, and we would 
that there existed similar ones for every period of our 
history. 

Among the sixty-five Capitularies of Charlemagne, the 
one which most concerns the history of economic sci- 
ence, is, in spite of the incoherence of its details, the 
famous capitulary De Villis, in which this great man at- 
tempted to sum up his views on the finances and upon 
the administration of his domains. It is composed of 
seventy paragraphs without any relation between them, 
and which considerably resemble the instructions of a rich 
landed proprietor to his steward. The prince demands, 
first, that he be served with probity, and that his people 
be well cared for, so as to be protected from poverty.* 
He will not have corvees imposed upon them, or any 
fatiguing labors : if they work in the night, an account 
shall be kept of it. They, on their side, must take good 
care of the wine from the vintage and bottle it so that it 
may not be injured. If they deviate from the course 
imposed upon them, they may be punished by flogging, 
or according to the good pleasure of the king and queen. 
Care must be taken of the bees and of the geese, and 
watch kept over th'e maintenance and increase of the fish- 
ponds. Cows, breeding mares, and sheep must be multi- 
plied. " We wish," adds the master, " our forests to be 
intelligently managed, not to be cleared, and that sparrow- 
hawks and falcons be kept in them. There must always 
be at our disposal fat geese and chickens likewise ; the 
eggs not needed for consumption on the farms shall be 
sold. Each of our estates shall be provided with good 
feather beds, mattresses, coverlids, copper vessels, lead, 
iron, wood, chains, pot-hooks, hatchets and augers, so that 
nothing will have to be borrowed of any one. Charle- 
magne wished also to have an account of his vegetables, 

* " Utfamilia nostra bene conservata sit, et a nemineinpaupertatem missa." 



OCCUPATIONS. RENDERING ACCOUNTS. Ill 

his butter, cheese, honey, oil and vinegar; yes, even of his 
turnips and other minutiae, as says the text of the Capitu- 
laries. One cannot help asking what time he would have 
had to verify such accounts, if they had been furnished 
him. 

We find also in the same capitulary a curious enumera- 
tion of the various occupations which he judged necessary 
to have on each of his great estates. There were to be 
blacksmiths, goldsmiths, cutters, turners, carpenters, bird- 
catchers, makers of nets, and men to take charge of mak- 
ing the cider and perry. Every slave who wished to 
speak to the sovereign on account of his master was to 
have access to his person ; this favor could be refused 
him under no pretext. Charlemagne had fixed upon the 
Christmas season for the general rendering of accounts, 
and the good old Harpagon'" was not more exacting than 
this great man in this difficult matter. The sixty- 
second article of the capitulary De Villis presents the 
clearest evidence of it: "" It is important," it says, "that 
we know how much all these things yield us ; " and he 
enumerates the cattle, mills, woods, ships, vineyards, 
vegetables, wool, flax, hemp, fruits, bees, fish, skins, wax 
and honey, old and new wines, and the rest. Everything 
which has not been consumed in the service of the prince 
must be immediately sold. The august economist in- 
genuously adds : " We hope that all this will not appear to 
you too hard, because you can exact it in your turn, 
each being master on his farm." His royal solicitude 
went still farther when the transportation of wine and 
flour destined for his personal use was concerned. "You 
will take care to have the wine carried in casks duly 
hooped with iron, and never in leathern bottles ; as to the 
flour, it must be placed in carts lined and covered with 
leather, so as to be able to cross the rivers, if necessary, 
without running the risk of damage. I wish also a good 
account to be rendered me of the horns of my bucks and 
my goats, as well as of the skins of my wolves taken in 



112 HISTORY OF POLITICAL ECONOMY. 

the course of each year. In the month of May, let terri- 
ble war be made without fail, on the wolves' whelps." 
Finally, the last paragraph of that strange document con- 
tains perhaps the rarest nomenclature which exists of 
plants of every kind and fruit trees, known in the ninth 
century, of which the great regulator of the royal domains 
did not wish the cultivation to be neglected in any of his 
gardens. 

Such is, in substance, this celebrated capitulary De 
Villis, which sums up much better the domestic economy 
of Charlemagne than his political economy. One meets in 
the other capitularies of the new Caesar exact provisions 
on economic questions, notably the following passage, in 
which is found, as Mr. Guizot has justly said, a veritable 
attempt at a maximum : " The very pious lord our king 
has decided that no man, whether ecclesiastic or layman, 
shall, either in time of abundance, or in time of scarcity^ 
sell provisions higher than the price recently fixed per 
bushel, namely, etc." There is found besides, the crea- 
tion of a poor tax, with the object of suppressing mendi- 
cancy. " As to the beggars which overrun the country, 
we wish that each one of our faithful should support his 
poor, either on his benefice or in his house, and not allow 
them to go elsewhere to beg. And if one finds such 
mendicants, and they do not work with their hands, let 
no one take upon himself to give them anything." Some- 
times the injunctions of the legislator were formulated 
under the appearance of a simple interrogation : " Ask 
the bishops and abbots to declare to us truly what these 
words mean which they often use, to renounce the world ; 
and by what signs one can distinguish those who renounce 
the world from those who do not renounce it ? Is it sim- 
ply by this, that they do not bear arms and they are not 
publicly married ? Ask again if that one has renounced the 
world, who works every day, no matter by what means, to 
increase his possessions, now promising the beatitude of 
the kingdom of heaven, now threatening the eternal tor 



PRIESTS REPRIMANDED. USURY. II3 

ments of hell ; or perhaps, under the name of God or of 
some saint, plunders some man either rich or poor, of 
simple mind and little on the guard ? " 

The language of Charlemagne was not less significant, 
as one sees, in his insinuations than in his prescriptions. 
The corruption and domination of the priests must have 
already in his reign acquired a very serious character, for 
him to resolve to address to them such severe reprimands. 
Besides,* he recommends to them not to swear, not to 
get intoxicated, not to frequent bad places, not to keep 
women, and not to sell the sacraments too dearly. Usury 
was then an abuse as habitual to the clergy as to the rest 
of the inhabitants ; the capitularies revert to it in more 
than twenty instances, and constantly stigmatize it in 
every manner. These pious provisions, however, do not 
prevent the emperor from himself fixing the rate at which 
the people shall take his money, good or bad, or from 
condemning to heavy fines men bold enough to contest 
its excellence. But these tyrannical prescriptions are 
often compensated by measures favorable to the slaves, 
the peasants, and the poor, whom it is ordered shall be 
helped, gathered into asylums, and cared for when they 
are ill. The ecclesiastical rules occupy a considerable 
place in the capitularies. One cannot doubt, from their ex- 
tent, the great importance that was attached to the clergy 
and the monks, who were almost masters of the adminis- 
tration in consequence of their superior intelligence, and 
were consulted by Charlemagne in the smallest details. 
They were exempt from military service, a painful duty 
then imposed upon all, without pay, and for an almost 
unlimited time. Any lack of consideration for them or 
any injury to their person was punished with double se- 
verity. 

We find in the capitularies of Charlemagne few traces 
of any system of imposts. The revenue of the state ap- 
pears to have consisted principally in the fines, which 

* Capitula Episcoporum. 



114 HISTORY OF POLITICAL ECONOMY. 

were numerous and high, and the farm rents of the do- 
mains of the emperor. The minute care with which 
Charlemagne had regulated everything pertaining to this 
subject, does not permit us to doubt that the rent of his 
lands was the most essential chapter of his budget. A 
few toll-houses situated on the high-ways, at the approach 
to certain bridges, furnished supplementary resources, 
and were managed in common with the great proprietors, 
and became, under the feudal system, the source of the 
most frightful exactions. Moreover, to the reign of 
Charlemagne must be attributed the restoration of the 
Roman laws which forbade the export of grain in times 
of scarcity, under penalty of confiscation, and we have 
seen that he did not recoil before attempts at fixing 
maximum prices, which resulted in aggravating the evils 
they were intended to remedy. Nevertheless, Charle- 
magne may be considered, in those half barbaric times, 
as the prince who best comprehended the true interests 
of commerce. His capitularies contain a multitude of 
provisions more liberal than any of those of the Roman 
emperors. He had established on the frontiers, officers 
charged with protecting the relations with foreigners, 
and it was he who placed the first guard-boats at the 
mouths of the rivers, either for the intimidation of pirates, 
or in the interest of navigation. He had undertaken to 
excavate a navigable canal joining the Rhine to the Dan- 
ube. He ordered the establishment of a regular system 
of weights and measures throughout the empire, prose- 
cuted with severe penalties the making of counterfeit 
money, and forbade monopolies. His edicts were not 
less opposed to the purchase of standing crops, as a sys- 
tem of shameful speculation which aimed to take advan- 
tage of the poverty of the cultivators and to make pro- 
visions dear. At the same time, he impressed the prop- 
erty of the churches with perpetual immobility, by oppos- 
ing its ever having any other destination, and he took care 
to increase it by prescribing donations in lands and tithes, 



CONDITION OF THE SLAVES. II 5 

which were paid by his own domains. We are forced to 
acknowledge that the slaves of his time were treated with 
more philanthropy and decency than the unfortunate 
negroes of our colonies. The husband could not be sep- 
arated from the wife, and the article of the capitulary 
which contained that provision, rests on the words of the 
gospel : " Whom God hath joined together, let no man 
put asunder." It was forbidden to buy or sell a slave 
other than in the presence of the deputies of the em- 
peror. Every secret sale was annulled and punished. 

That solicitude for slaves at a time and under a reign 
when slavery was every day extending, is easily ex- 
plained. The donations of lands which the emperor 
was constantly making to the nobles and to the churches, 
daily diminished the number of cultivators who could 
live upon their incomes, and their condition became so 
unhappy that they preferred slavery, or rather, servitude. 
By degrees, almost all the free men disappeared, and 
their little inheritances were added to those immense do- 
mains granted by imperial munificence to the military 
and the ecclesiastical aristocracy. Thus were confounded 
the ideas of political sovereignty and of landed property 
which were to become the basis of feudal anarchy, as 
soon as the hand of the supreme, chief ceased to keep the 
respect of ambitious and powerful vassals. He himself 
prepared the way for this great event by dividing the em- 
pire between his children and weakening his own work : 
here his reputation is especially vulnerable ; and it is 
on account of the ephemeral character of his works 
that many historians have felt authorized to judge him 
severely. It is, however, just to recognize that Charle- 
magne has nothing in common with most of his prede- 
cessors or of his successors. All that we know of his intel- 
ligent interest in the sciences and the generous efforts he 
made to promote them, of those bold attempts at cen- 
tralization at a time of universal dismemberment, of that 
marvellous creation of a great empire in less than forty 



Il6 HISTORY OF POLITICAL ECONOMY. 

years, can be the work only of a superior genius, and 
makes us comprehend very well how Charlemagne was 
honored with the name of Great during his life and 
canonized after his death. He had doubtless many of 
the vices of his time, and his personal morals seem too 
often in contradiction with the rigidity of his capitu- 
laries ; but his thought will not be sterile, and his labors 
are a grand spectacle, especially when compared with 
the lamentable gestes of the do-nothing kings. This 
prince dreamed of the reestablishment of Roman gran- 
deur with German elements. A Barbarian, and the 
descendant of a Barbarian, he succeeded in mastering 
the tide which brought him along, and he would have 
had complete success, if he had not endeavored to 
unite elements too dissimilar, that is to say, people 
already classed by the difference of their languages, 
the opposition of their interests, and their geograph- 
ical situation. " Charlemagne," says Mr. Raynouard,* 
" thought he had for subjects only warriors and eccle- 
siastics, he was great, but by himself alone and for 
himself alone. No illustrious name appears besides 
his, even beneath it ; he absorbed all the glory of 
his reign. Swayed by the exigencies of the moment, by 
chance necessities, he often published laws to counte- 
nance the action of his government, while repressing 
rising abuses ; but his legislation had no unity and was 
rarely marked by any solicitude for the future." There 
only remained from him the hereditary transmission of 
benefices from which the feudal system was to arise with 
its miseries and its germs of renovation. It was a fearful 
principle ; but in the absence of monarchical unity, this 
principle was better than anarchy. We are now about to 
study its consequences. 

* History of Municipal Law in France, vol. 2, p. 385. 



CHAPTER XIII. 

The establishment of the Feudal System and its economic consequences.— 
The monarchy of Charlemagne dismembered by the influence of the hered. 
ity of fiefs. — General extension of serfdom. 

The capitularies of Charlemagne especially sanction 
the power of the Church, which alone is henceforward 
to intervene as a mediator between humanity and its 
oppressors ; and its intervention is worthy of note, since 
the Capitularies constituted the law in France until the 
reign of Philippe le Bel. The Church alone will balance 
the power of the barons, and will give it a fatal blow by 
taking the side of the people, as it ended the Roman 
empire by allying itself with the Barbarians. In fact, 
less than half a century after the death of Charlemagne, 
his empire had already been divided into seven king- 
doms, and the counts and dukes, imitating the style of 
this great man and taking advantage of the times, had 
sought to create for themselves independent positions. 
The fiefs tended to become more and more hereditary, 
and the sovereigns readily consented to it. We read in 
a capitulary of Charles the Bold, in 877, the following 
provisions, which are decisive in that respect: " If, after 
our death, any of our faithful subjects, moved by love of 
God and of our person, wishes to renounce the world, 
and if he has a son or other relative capable of public 
service, let him be free to transmit to him his fief as he 
shall please."* Another article confirmed this and com- 

* Capitularies, edit, of Baluze, vol. 2, p. 266. 



Il8 HISTORY OF POLITICAL ECONOMY. 

pleted the reduction of the empire ; for before the end 
of the ninth century, there were twenty-nine great fiefs, 
more or less independent, and more than fifty, at the 
end of the tenth, in France alone.* 

This new aspect of social dismemberment has been 
graphically described by the historians : " The kingdom 
formerly so well united," says one,f " is now divided : 
there is no longer any one who can be considered as 
emperor ; instead of a king, one sees petty princes : in- 
stead of a kingdom, fragments of a kingdom." In reality, 
all the grand organization of Charlemagne had disap- 
peared to give place to turbulent and weak confedera- 
tions which would certainly have had to yield, if any 
powerful aggressor had attacked them. From that time, 
the history of France is no longer anything but a com- 
pilation of provincial annals, burdened with purely local 
details, in which one can scarcely follow the course of 
civilization. The most able and conscientious writers 
have been obliged to have recourse to hypotheses to 
explain that unexampled disintegration, which was 
brought about almost instantaneously. M. Augustin 
Thierry attributes it to the difference of races, and M. 
Guizot to the loss of administrative traditions and of 
great thoughts on general policy. We believe these 
two causes have acted in different proportions. As the 
cohesion became weaker, the spirit of race or rather of 
locality was developed, probably according to circum- 
stances which it is impossible for us to appreciate : and 
the Europe of those times must have resembled certain 
portions of Asia at present, where a few bold pachas, a 
few independent chiefs, levy contributions upon the 
people who are subject to them, without having even 
among themselves any federal relations. 

There is consequently no reason for surprise that new 
hordes of invaders made an irruption into our territory, 

* Guizot, Cours d'Histoire Moderne, vol. ii, p. 435. 

f Recueil des Historiens des Gaules et de la France, vol. ii, p. 302. 



DISMEMBERMENT OF THE MONARCHY. 1 19 

and that the descent of the Saracens at the south and of 
the Normans at the north caused a deluge of woes to 
pour down upon our unhappy ancestors. There was no 
longer a bond anywhere, and no more obedience ; civil 
wars and devastations soon produced an abandonment of 
agriculture, and famine added its rigors to all these 
scourges. A handful of pirates seized Marseilles in 848, 
and the Normans burned Bordeaux some time after. 
Their barques ascended the Seine and plundered Paris, 
in 856. The inhabitants ran into the temples instead of 
fighting, and the kings consented to ignominious treaties, 
in virtue of which these very Normans, having no longer 
anything to plunder in a ravaged country, caused it to be 
adjudged to themselves on condition of defending it. 
Thus Normandy received its name from the invaders, 
and the capital of Charlemagne, the city of Aix-la-Cha- 
pelle, was profaned by a band of foreigners whom this 
great sovereign had always treated as pirates. How 
times had changed ! The edict of Piste * threw barely 
a gleam of good order into that darkness of anarchy and 
troubles ; the fortifications of the feudal barons were not 
yet altogether thrown down, so that they were again 
raised, no more to disappear until they fell before the 
power of Louis XI, Richelieu, and Louis XIV. A new 
contract was formed between the usurper of the soil and 
the cultivator. The great land-holding abbots, the dukes, 
the counts, and the lords, sought the homage and support 
of their vassals almost as much as their wealth. They 
estimated the value of the land much more by the popu- 
lation than by the revenue it could furnish. The donjon, 
menacing as it was to neighbors and to strangers, was to 
the vassal a protector. The younger sons of noblemen, 

* This edict is in the Collection des Capitulaires , p. 174, vol. ii, edit, of 
Baluze. It is composed of thirty-seven articles and of three supplementary 
paragraphs. Its aim, among others, was the general recoinage of the money, 
the making of which was accorded to only ten cities ; it fixed the relation 
between gold and silver at twelve pounds of silver for one of gold ; it com- 
prehended besides various rules concerning bakeries, the regulation of the 
markets, and the verification of weights and measures. 



120 HISTORY OF POLITICAL ECONOMY. 

the free men, and the bourgeois, were permitted, on con, 
dition of a promise of subordination, to take their share 
in the profits of the land, and could marry without detri- 
ment to the interest of their masters. The latter, fight- 
ing on horseback in virtue of their privilege, allowed 
them to bear arms and to fight on foot ; thus were estab- 
lished in the tent relations of good will, and those of differ- 
ent ranks were brought nearer together, and the way pre- 
pared, though indirectly, for the reign of equality. Every 
village soon formed a community bound together by in- 
terests, passions, and almost by kinship. Who can tell 
how much this wholly municipal political system, from 
which was one day to come the emancipation of the com- 
munes with the industrial corporations, contributed to the 
progress of civilization and political economy ! We do 
not know ; but the transition was long and painful, and 
the donjon was not long in turning against the villages. 
Discord appeared among the myriads of lords, who wash- 
ed away their offences in the blood of their subjects ; and 
for more than three centuries Europe presented the as- 
pect of a vast arena where the stronger pitilessly took 
advantage of the weaker. There was no longer capital 
to give enterprise, nor great cities to receive it, but only 
convents and castles, separated by rivers without bridges, 
marshes without causeways, and forests without roads. 
Justice was seated in the recesses of obscure manors, 
more often the victim than the companion of force ; peo- 
ple came to plead at the feet of all-powerful lords. Com- 
merce, reduced to simple peddling from door to door, 
avoided the observation which to-day it seeks ; and be- 
sides, what attractions could it have for men barded with 
steel and served in even their lightest caprice, by numer- 
ous artisans ? The number of these workmen, however, 
diminished daily, because of the ruin of the cities devas- 
tated now by a foreign enemy, and anon by civil war ; 
and soon there were no other manufactures than those 
devoted to the production of the most indispensable 



END OF THE WORLD EXPECTED. DISCORD. 121 

articles. The spirit of liberty, then, became extinct with 
the great cities ; no more franchises, no more of those 
energetic and noisy rivalries which aroused the imagina- 
tion and which we shall find again in the midst of the 
Italian republics of the middle ages ; but a general isola- 
tion of all minds and of all localities ; a confused dust of 
peoples and kings. The witnesses of that epoch of dis- 
solution were so alarmed by it that they thought the end 
of the world at hand, and they prepared for it as for an 
inevitable event. There have come down to us a multi- 
tude of testaments or deeds of gift which we're prompted 
by the supposed near approach of that fatal catastrophe. 
Most of them commence with these words : Adveniante 
mundi vespero, i. e., the end of the world being at hand. 
But happily it did not come, and it caused no other rav- 
ages than the consequences of the fear which it had in- 
spired. In many places labor had ceased ; slaves had 
been restored to liberty, old hatreds had been appeased, 
and wicked people had been converted. What a triumph 
for the church ! what recrudescence of fervor for the 
faith ! But at the same time what stupidity there was 
among the people and what hope could be conceived for 
them when reduced to such a degree of brutalization ! 

This, too, was a time marvellously suited to all auda- 
cious attempts and tyrannous encroachments. We hear 
no longer of political wars, but of expeditions of brigands 
and incursions of pirates. The lords, who were author- 
ized to coin money, to administer justice, to pronounce 
as sovereigns over the lands within their jurisdiction, 
broke the last bonds of all national unity, and alarmed 
Europe with the bloody spectacle of their discords. The 
castles constructed on every side, seemed to nourish that 
fever for battles, by offering secure retreats to all disturb- 
ers of the public peace. History, if its thread can be 
recognized in that long series of atrocities, is no longer 
anything but a confused mass of events without connec- 
tion and without bearing, much more characteristic of 
savage hordes than of inhabitants of a civilized country. 



122 HISTORY OF POLITICAL ECONOMY. 

However, we discover in it quite a clear trace of the 
principal elements of the social condition of the laborers. 
Almost all had retired into the country, and they were 
there divided into three classes ; the serfs, the villeins, 
and the free men. The first, bound to the soil, adscriptae 
glebae, were considered as the tJimg of their masters, as 
veritable fixtures by destination. Notwithstanding the 
prescriptions of the capitularies, which had become obso- 
lete, their masters had resumed the power over them of 
life and death. They shaved their hair, inflicted tortures 
upon them, interdicted marriage and refused them the 
right of testifying in court against free men. They were 
distinguished from the latter by a particular dress, and 
could not even dispose by will of the rags which but illy 
covered their nakedness. No authority could intervene 
between the master and the serf, whose condition must 
have been inferior, during that sacrilegious period, to that 
of the beast of burden. The villeins {villani, inhabitants 
of country houses) differed from the serfs in being allow- 
ed to pay their masters certain rent-dues, in consequence 
of which the surplus of the products of cultivation be- 
longed to themselves. There were, however, numerous 
exceptions to this rule, and generally the villeins were 
subject to the taille or villein-tax and to corvees without 
thanks or pity. A very small number of free men still 
preserved a shadow of independence, under the names of 
conditionales iributarii, and arimaiuii, which prove that at 
the same time this independence did not belong to them 
unconditionally. These were probably small proprietors 
who paid also their share of rent to the lords, either in 
money or services, and whose condition was so precarious 
and wretched that they were in the habit of renouncing 
their freedom, often made more onerous to them than 
servitude. This renunciation of the functions of a free- 
man was called obnoxiatio, and millions of unfortunates 
resigned themselves to it to enjoy a protection which 
certain lords and certain monasteries assured to their 



CONDITION OF REAL-PROPERTY. 1 23 

enfeoffed vassals. Their cry of despair resounded 
throughout all Europe, and authors note it at the same 
time in France, England and Germany. Are there not 
still several thousands of serfs in Russia * to-day, and 
are not lands sold there with the peasants who dwell on 
them ? f 

Political economy cannot throw much light on the situ- 
ation of real property at that deplorable epoch. All that 
is known is that some real estate was possessed under a 
perpetual title, and some other under a beneficiary title. 
Insensibly most of the freeholders transformed them- 
selves into feudatories, in order to secure protectors, as 
in the inferior ranks many free men had reduced them- 
selves from the same motive to the condition of serfs. 
Property in land became thus the symbol of power, and 
by successive usurpations, there became attached to it 
an immense number of privileges, most of which still re- 
main and form not the least part of the economic com- 
plications of our time. Who does not easily recognize 
the old predominance of feudal property in the delays in 
expropriations for public purposes, or for judicial reasons, 
in the vicious system of mortgages, in the assessment of 
taxes favoring altogether real estate, and in the electoral 
privilege which guarantees all the others ? See the in- 
stitutions of England and of Germany ; travel over Spain 
and Italy ; feudalism is still alive in them, and it is even 
found in France, notwithstanding the revolutionary laws 
which reduced real property to atoms. " The manufac- 
turer and the trader are still, in the eyes of many people, 
the sons of the freedman and of the slave; on the other 
hand, there is always a presumption in favor of the landed 
proprietor. The latter is protected, not as an agricultu- 
rist and worker, but rather by reason of his abstract qual- 

* More than 20,000,000 were emancipated by Alexander II, in 1861, and 
all have been entirely free in their persons since March, 1863, and they have 
also the perpetual usufruct of their cottages and gardens. — -Trans. 

\ See, on the condition of the peasants in the middle ages, Z' Histoire des 
classes agricoles en France, by Dareste de la Chavanne, 1858. 



124 HISTORY OF POLITICAL ECONOMY. 

ity of proprietor, possessor of the soil, and legatee of the 
patricians or of the feudal baron." * This explains how 
some gleams of civilization have arisen from that feudal 
darkness which seems to have enveloped the world for 
several centuries. If great political ideas disappeared, 
great individualities began to be conspicuous and became 
sufficiently penetrated with their own importance, to 
merit a passing glance from history. Knightly armor and 
the privilege of fighting on horseback strengthened among 
the lords the feeling of their independence and of their 
rights, and preserved to human dignity an asylum free 
from servitude. The feudal barons, true republican noble- 
men, less enlightened than those of Rome and Athens, 
created for themselves a common law, founded on loyalty 
to promises and respect for their pledged faith. They 
sought in the sacredness of the oath a guarantee against 
the violence of their passions which a powerful central 
government no longer could restrain. They put women 
for the first time under the protection of French gal- 
lantry, and prepared, perhaps unconsciously, the way for 
the more serious changes that occurred in the subsequent 
centuries. We shall see them, combined with the clergy, 
fanning the sacred flame of the crusades which civilized 
the world by commerce, while waiting until their dis- 
cords regenerate it by freedom. 
* Letters of Michel Chevalier on North America. Vol. ii, p. 268. 



CHAPTER XIV. 

The Crusades and their influence on the course of political economy in 
Europe. — Saladin tithe. — Revolution in habits. — Progress of navigation, the 
industrial arts and commerce. 

In the midst of the feudal anarchy of Europe, the half- 
chivalric, half-religious enterprise of the crusades was a 
happy idea. The first suggestion of it came from the 
clergy ; its execution belongs wholly to the nobility, whom 
that generous fever was to cost so dearly ; but the people 
received lasting benefits from it, the first of which was, 
becoming rid of a multitude of oppressors. How many 
decisive events, in effect, grew out of these famous cru- 
sades ! The emancipation of the communes, the modifi- 
cation of serfdom, the appearance of the bourgeoisie, 
the revival of industries, the creation of commerce and 
navigation, and the fortune of that pleiad, so brilliant 
and so poetic, of the Italian republics. This was not the 
work of a day ; but the work, once commenced, has not 
ceased to go forward with a regular step towards its full 
accomplishment. No time has elapsed without some gen- 
eration bringing its tribute of intelligence and enthusi- 
asm ; so much did the world, weary of feudal chaos, long 
for repose in a contemplation of a glorious future ! 

It is extremely interesting to follow the progress of 
that revolution in the confused history of the eleventh 
century ; and everything from the usurpation of Hugh 
Capet, to the wanderings of the troubadours, cooperates 
in it as if by enchantment. One might have thought 

125 



126 HISTORY OF POLITICAL ECONOMY. 

that all Europe was going to continue in the East the in- 
vasion scarcely established in the West, so many travelers 
presented themselves for these adventurous expeditions. 

They were composed not alone of warriors ; following 
the soldiers was an immense multitude of artisans, traders, 
lookers-on, paupers, rich people, monks, women, and even 
infants from the cradle ! * It was this turbulent mass 
which so many times compromised the safety of the army 
by their disturbances and by the wretchedness they left 
along their path. Famine committed more ravages among 
them than the sword of the enemy ; and we cannot to- 
day conceive of such excessive distress as that of which 
historians have handed down to us the lamentable details. 
A chronicler who had witnessed them, exclaimed, " Would 
to Heaven the Pope had not permitted the weak to take 
the cross ; that he had given the strong a sword instead 
of the pouch, a bow instead of a staff ! " One fatal habit 
which we shall be pardoned for alluding to, because it 
has since penetrated, unfortunately, European morals, 
originated at that time among the crusaders ; it was the 
passion for gaming. This thirst for sudden wealth made 
such progress that everybody played, from the chieftains 
to the lower soldiers. After the conquest of Constanti- 
nople, the knights gambled with dice for the cities and 
provinces of the Greek empire. The companions of Saint 
Louis, during their stay at Damietta, staked even their 
horses and their arms. 

What human motive could have induced so great a 
crowd of men to abandon their country to incur such 
risks ! Religious enthusiasm had much to do with it ; 
but poverty, serfdom, and the hope of bettering their 
condition, had still more influence. A crusader's law 
granted land, a house, a city even, to him who should 
be the first to raise a flag there. The first crusaders were 
exempt from the villein-tax, and the payment of theif 

* Michelet, Hisioire des Croisades, vol. vi, p. 43. 



CRUSADERS FAVORED. SALE OF LANDS. 1 27 

debts was stayed.* Their possessions were put under the 
protection of the church, and by a favor entirely contrary 
to the customs of the feudal system, they could pledge 
their fiefs and sell them, either to the laity or to the ec- 
clesiastics, without the permission of their lords. The 
crusaders were henceforth amenable only to ecclesiastical 
tribunals. There was such a fever that artisans, traders 
and farmers abandoned their work and their business ; 
barons and lords hastened to dispose of their domains. 
Lands and castles were sold for moderate sums ; and this 
circumstance, by bringing about serious modifications in 
the system of land ownership, contributed not a little to 
the gradual and definitive affranchisement of the com- 
munes. The settled bourgeoisie grew rich by degrees 
from the domains sold by the wandering nobility, and 
the power passed thus with the lands into the hands of 
the new possessors. There came a time when the estates 
no longer found buyers. The crusaders spurned every- 
thing which they could not take with them ; the products 
of the soil were sold at a low price, and abundance sud- 
denly reappeared in the midst of scarcity. 

When we attentively study the details of this great 
movement, it is impossible not to be struck with its re- 
semblance to the invasion of the Barbarians. There were 
the same dreams of enjoyments and of riches; and, just 
as Europe had appeared to the latter an abode preferable 
to their forests and their swamps, so the East seemed to 
the crusaders an Eldorado unequalled in the world, a ver- 

* The following are provisions relating to that privilege : " The warriors 
who shall have taken the cross, shall have, in which to pay their debts, to 
Jews as well as to Christians, the space of two years, reckoning from the 
first feast of All-Saints. Interest shall not accrue to any one from the day 
of taking the cross. If any warrior or clerk engages for a fixed number of 
years, his property or his revenues, to any bourgeois crusader, or to a war- 
rior or clerk not a crusader, the tenant shall collect that year the fruits of 
the land or of the revenues, and the creditor, at the end of the years for 
which he was to hold the engagement or the farm, shall retain them one 
year longer, in consideration of the year he has lost. No crusader can be 
summoned by law for the execution of his promises, from the day of his 
departure to that of his return, unless for obligations incurred before he 
assumed the cross." 



128 HISTORY OF POLITICAL ECONOMY. 

itable vestibjile of Paradise, as one of them naively said.* 
The love of adventure and of freedom, the certainty of 
escaping from bondage to the soil with their wives and 
children, attracted thousands of men. Monks, tired of 
the discipline of their convents, could escape from it by 
a pilgrimage to the holy land ; malefactors even, absolved 
from their crimes by indulgences, hastened in crowds to 
the banners of the cross, and took the road to Jerusalem. 
Those who had the good sense to resist the general im- 
pulse realized considerable profit from the acquisition of 
land and property of every kind, and from the sale of 
horses and arms, the demand for which increased in an 
unheard of degree. We know the terrible checks which 
decimated that stupid and coarse crowd in its first cam- 
paign towards the East, where few of the travelers ar- 
rived safe and sound. At the time of the second crusade, 
some little order was required in the enrollments, and 
some few conditions were imposed on those whose de- 
parture was authorized. The third gave rise to the Sala- 
din Tithe,-\ a species of forced contribution the receipts 
from which were destined to provide for the wants of the 
crusaders, and from which none were exempt except those 
who paid with their person. The feudal system had so 
penetrated the morals and the laws, that the principal 
grievance against the recalcitrant tax-payers came from 
their refusing to Jesus Christ, as suzerain, the homage 
which every good vassal was supposed to owe his lord. 
When, notwithstanding these numerous expedients, the 

* Others were more specific. In his letter to the Count of Flanders, 
Alexis named, among his motives, ''^ amor auri et argenti ei pulcherriniarum 
fceminarum voluptas.'^ 

\ The text of that curious document has been preserved by Rigord, the 
chronographer of Philip Augustus, who compiled in bad Latin a journal of 
the reign of that prince. This is the beginning : " All those who are not 
crusaders shall give this year at least a tenth of all their movable property 
and of all their revenues. The warrior not a crusader shall give the cru- 
sader lord whose liege man he is, the tenth of his own personal property and 
of the fief he holds from him. All the laity shall give their tithes under 
oath and the penalty of the anathema, and the clerks under that of excom- 
munication." 



HOW CRUSADERS OBTAINED FOOD. FAMINE. 1 29 

managers of the crusades lacked money, they began to 
plunder the Jews, the Greeks, and even the Christians. 
Want was sometimes so severe and necessities so press- 
ing, that they went even so far as to impose taxes on the 
property of churches and religious communities, which 
complained loudly at it. It was what the monks of the 
time called delivering up the vine of the Lord to the fury of 
the Turks, an abominable act deserving the pains of hell. 
The revolution caused by the crusades exercised too 
much influence on the development of European institu- 
tions, not to lead to careful investigations into the means 
by which these expeditions to distant lands were sup- 
plied with food. At the beginning, as we have seen, 
enthusiasm sufficed : the volunteers supported themselves 
from the product of lands sold or funds borrowed ; later, it 
was necessary to feed and pay them, for the inhabitants 
everywhere fled at their approach and left them only 
deserted places to travel through. There exists a singu- 
lar letter of pope Innocent III to the leaders of the fifth 
crusade : " You are devoted," he said to them, " to the 
service of the crucified to whom the whole earth be- 
longs. If any one should refuse you the necessary pro- 
visions, it would not appear unjust that you should take 
them wherever you can find them, always in fear of God 
and with the intention of making restitution^ The 
learned historian of the crusades who quotes this letter 
very sensibly adds : " It is unnecessary to say that the 
crusaders were naturally inclined to follow the advice of 
the pope, and that they did not wait for it before pro- 
curing the provisions they needed." Their practice of 
pillaging did not always keep them from famine, and 
the history of the crusades is full of accounts of their 
sufferings. There was no regularity in the supplies of 
provisions, except at the time when the expeditions were 
made by sea, with the intervention of the powers which 
bordered on the shore of the Mediterranean. 

The results of the crusades have been looked at in 



I30 HISTORY OF POLITICAL ECONOMY. 

various ways, according to the point of view which the 
various historians have taken. Considered in their rela- 
tion to human freedom, it cannot be denied that the 
crusades contributed to alleviate slavery, by enabling a 
multitude of the serfs of the nobility to pass into the more 
tolerable condition of dependence on the clergy. By 
weakening the fortune and the number of the lords, they 
made way for the coming in of the bourgeoisie. The 
continual consumption of soldiers they occasioned, ren- 
dered men scarce and led to good treatment of those re- 
maining in the West. At the same time, the latter, 
invested with the local government in the absence of 
their masters, administered with moderation, and allowed 
the people to form habits which the barons, on their re- 
turn, did not venture to oppose. Peace reigned in the 
rural districts all the time that the tyrants of the castles 
were making war in the Holy Land. The truce of God, a 
work of the clergy, which the expeditions into Palestine 
rendered still more sacred, placed under the safeguard of 
the church the husbandman and his plough, I might 
almost say his independence. We cannot say how far 
that alliance might have extended, if the serfs who set 
out for Jerusalem had thought of employing for their 
own emancipation the enthusiasm which was urging them 
on to the conquest of a tomb. 

Insensibly the clergy took the place of the nobility in 
the administration of justice, protected the widows and 
orphans, the strangers, the poor, the lepers. They had 
become the guardians of all minors abandoned by heads 
of families; and, confining the penalty of their sentences 
to spiritual punishments, they substituted for the sword 
of the lords a weapon less dangerous and yet as much 
respected. Their supremacy, daily increasing, finally 
excited the jealousy of the barons, who, in the thir- 
teenth century, formed a league against the clergy, 
demanding that they render unto Ccesar what belonged to 
CcEsar. The intervention of the popes was necessary to 



PARLIAMENTS. COMMERCE. MARITIME LAWS. 131 

reconcile this serious difference, which we shall see repro- 
duced, and from which liberty will profit. Hence arose 
parliaments, that bourgeois justice, offspring of the 
clergy, which has rendered so many services to humanity 
by keeping alive and making respected the old Roman 
maxim, Cedant anna togcB. We must also recognize that 
the necessity of looking out for the future, as well as the 
great number of testaments and contracts that the pil- 
grims had to sign, made the importance of law and jus- 
tice felt, and consequently seconded the progress of legis- 
lation and jurisprudence. But the progress was more 
strikingly manifest in manufactures, navigation and com- 
merce. At one time it seemed as if the navigators of 
all countries had made a rendezvous in the Eastern 
waters. Bremen and Liibeck made the acquaintance of 
Genoa and Venice. The Baltic Sea, a mysterious retreat 
of Norman pirates, was discovered and explored. The 
Hanse towns, by putting liberty under the protection of 
commerce, prepa:red in the North a confederation rival- 
ing the Italian republics, which brought, like them, its 
tribute of intelligence and wealth to the common centre 
of civilization. Naval architecture increased the size of 
vessels for facility in the transport of pilgrims. Fifteen 
years after the third crusade, formidable fleets might be 
seen leaving the ports of Venice and Genoa such as the 
Mediterranean had never before carried. Navigators 
from Barcelona published the first collection of maritime 
laws which were authoritative in Europe. The Assizes 
of Jerusalem}^ contain some provisions of this kind, and 
history has preserved for us several regulations drawn 
up by Richard Coeur de Lion for the maintenance of 
order on board his fleets. Piracy was repressed. The 
regulations for the government of the seas, rigorously 
enforced by two or three powers interested in making 
good order respected, contributed much to the progress 
of commerce by giving it a commencement of security. 
Convoys of ships followed the coasts of the countries 



132 HISTORY OF POLITICAL ECONOMY. 

where the crusaders were fighting, and became rich by 
selling them provisions and munitions of war. 

Manufactures profited no less than commerce from the 
impulse given to ideas by the numerous expeditions to 
the Holy Land. We know that the crusaders preferred to 
enroll men who had a trade or some mechanical employ- 
ment. These industrial pilgrims did not always make a 
journey unprofitable for their country, and while their 
comrades were marching to the conquest of the Holy 
Places, the industrial arts had also their crusade and pur- 
loined from the Saracens and Greeks secrets and pro- 
cesses more valuable than victories.* The crusaders 
learned at Damascus how to work the metals and make 
cloth successfully ; they found in the East manufactures 
of camlet, patterns of which excited the admiration of 
Queen Marguerite. Many Greek cities supported silk- 
looms, which gave rise to the cultivation of the mulberry 
tree in Italy and consequently to an immense extension 
of its graceful products. The glass works of Tyre aided 
in perfecting the fine glass fabrics of Venice, so justly 
renowned in the middle ages. There is nothing, even to 
wind-mills, the introduction of which into Europe was 
not due to the travels of the crusaders. Sugar-carie, 
which they saw for the first time at Tripoli, was trans- 
ported by them into Sicily in the twelfth century ; a 
multitude of other plants not less useful, — among others, 
maize, since calle'd Turkish wheat, — owe also to them their 
naturalization in the West. How much time and trouble 
have nevertheless been necessary, for their conquests to 
bear fruit, especially when we recall that the most emi- 
nent men of the time, — Sire de Joinville, for example, — ■ 
supposed in their simplicity that pepper and cinnamon 
came from the terrestrial paradise and that spices were 
fished in the waters of the Nile whither they had been 
carried by the winds ! f 

* Michaud, Histoire des Croisades, vol. vi, page 346. 

f Mimoires de Joinville, 2d part, p. 36, edition of Ducange. 



RESULTS OF THE CRUSADES. 1 33 

On the whole, the crusades exalted the authority of the 
princes and introduced serious modifications into the feu- 
dal regime. The nobles who had become subjects, the 
bourgeois who had become merchants, and the cities 
which had become rich, assured to the public revenues 
new sources, fruitful and regular, which consolidated the 
power of the sovereigns. From this time, the third estate 
could be set against the nobility ; and it became by de- 
grees, under the auspices of royalty, a powerful and re- 
spected class. These results were not developed in the 
same degree or in a like manner in all the countries of 
Europe ; but they had no cause more potent than the 
crusades. We shall examine later the true elements of 
the affranchisement of the communes ; what is certain is 
that they did not receive a gleam of independence until 
after the great crusading expeditions. Commerce itself, 
whose rights the Barbarians had sometimes respected, 
would have succumbed under the weight of exactions 
with which feudal anarchy overwhelmed it, if the neces- 
sities of the Holy War had not caused a restoration of its 
former independence. Thus, while at Byzantium, every- 
thing, — bread, wine, oil, and eatables of every kind* — 
was reduced to a monopoly, provisions circulated freely in 
the Mediterranean and in the maritime cities under the 
auspices of the religious crusade. The Venetians caused 
the principles of commercial freedom to be adopted 
wherever their political influence extended. To them is 
due the establishment of the first general factories or 
trading-houses, which served as models to all those which 
the various nations to-day maintain in each others' coun- 
tries. The kings of Jerusalem, who had need of these 
bold merchants, accorded them numerous privileges and 
even territorial possessions. Thus the colonial spirit was 
born in Europe, and with it the bloody rivalries, the in- 
dustrial enterprises and financial contrivances in which 
the Jews, those shrewd economists of the middle ages, 
played a part which claims for a moment our attention. 

* Heeren, Essay on the Influence of the Crusades. 



CHAPTER XV. 

Considerations on the situation and influence of the Jews in the middle 
ages. — Nature of the services they have rendered to political economy. — 
Were they the first founders of credit ? — Origin of bills of exchange and 
monts-de-pi^te. 

While the feudal system was covering Europe with 
barriers, tolls, and restrictions of every sort,* com- 
merce took refuge in the bosom of a proscribed caste and 
under its influence preluded the magnificent destinies 
which the crusades were to assure it. It was indeed a 
spectacle worthy of interest to see the rapid development 
of wealth in the midst of the perpetual troubles of feu- 
dalism, and in the hands of the men the most mercilessly 
harassed, in that epoch of pillage and spoliation. It will 
not be unimportant to political economy to trace rapidly 
how this remarkable fact took its rise and grew to the 
rank of the most decisive events, under the sway of cir- 
cumstances least adapted to favor its appearance. 

I will not recall on this subject the history of the Jew- 
ish people and their long tribulations. Proscribed by the 
heathens, proscribed by the Christians and by the Mus- 

* To give an idea of the singularity and diversity of these tolls, it w^ill 
suffice to mention a few. A duty called pojitaticmn was paid for passing 
under bridges, and that of portaiicum to enter ports. The lords made 
the trading boats that sailed on rivers along lands under their dominion, pay 
on the river bank a tax called ripaticum ; they demanded another called 
tra7taticuni for according permission to carry merchandise on a sledge. The 
mansionaticum was paid to avoid lodgment of warriors, and the pulverati- 
cum, for the dust raised on the roads by trading wagons. There was 
also the telotieu??i, the paraverdum, the cespitaiicum, the coenaticuni, and 
many others whose names are no less barbarous and whose object no less 
odious. 

134 



PERSECUTION OF THE JEWS. 135 

sulmans, the Jews seemed to have thrived by persecutions 
and molestations, silently indemnifying themselves by the 
worship of gold, for the affronts heaped upon their relig^ 
ion, and always reappearing the more powerful as they 
were the more hated. As early as the time of Charle- 
magne, we see them in request at court, although they 
have no civil status and are not considered as citizens. 
Under Louis the Mild, they are refused the favor of the 
the judgment of God and of trials by fire and water; but, 
in compensation, they obtain private judges, and there 
exists, in 828, a special magistrate, an illustrious person, 
clothed with the office of Master of the Jews, who judges 
them and protects them. Many of them also came into 
France under the kings of the second race, principally 
into the cities of the south, where the demands of com- 
merce, facility in finding shelter while passing the fron- 
tiers, and the means they had of correspondence with 
their co-religionists of Asia, attracted a very great num- 
ber. For a brief period, one might think they were go- 
ing to become veritable mandarins ; their master resided 
at the court and was the intimate counsellor of the sov- 
ereign ; the princes and nobles sought their protection by 
rich presents, and even accorded them privileges envied 
by free men. 

Under the feudal regime no rank was assigned the Jews : 
they were to submit to the common law of servitude and 
obey the lords of the lands on which they were found. 
Their character of heretics prevented them from being pro- 
tected as much as other feudal subjects, and they reached 
the point of being exchanged, sold and lent like cattle. 
Nevertheless their existence was still supportable when 
the first systematic persecutions were directed against 
them in the reign of Philippe I, who drove them from his 
dominions in 1096. They returned, however, a few years 
after, on condition of paying for the privilege, and they 
would perhaps have been forgotten, had it not been for 
the crusades, which greatly increased religious zeal and 



I3<5 HISTORY OF POLITICAL ECONOMY. 

consequently the severity towards them. They were 
forced to contribute to the expenses of more than one 
campaign in the Holy Land, by means of a multitude of 
vague and odious accusations, which obliged them day by 
day to purchase life from the fury of the people with ex- 
orbitant sums. Though momentarily favored by Philippe 
Auguste, they finally led miserable lives under his reign, 
exposed to all kinds of outrages, and were forced, later, to 
wear a distinctive garb which too often marked them for 
murder and pillage. St. Louis burdened them with the 
most intolerable laws, freed their debtors, forbade all prose- 
cutions that would favor the Jews, and pushed his severity 
so far as to interdict them from making contracts.* An 
ordinance in 1254 expressly declared " that the Jews must 
cease usuries, blasphemies, and sorcery, and live hencefor- 
ward by the labor of their hands and other tasks, without 
loaning money." These ordinances were executed with a 
severity so much the greater, because the king declared 
that he had issued them to relieve his conscience and 
provide for his salvation. They even went farther in 
1239, and we find in the assizes of Brittany f an atrocious 
provision, in virtue of which it was forbidden to in- 
form against any one who should kill a Jew. Later, 
in 1288, the parliament of Paris condemned them to pay 
a heavy fine for having sung too loud in their synagogues. 
Philippe le Bel proscribed them and recalled them, by 
turns, according to the need he had of their money. His 
successor treated their existence as a purely commercial 
matter, and allowed them to collect their debts on con- 
dition of paying him two-thirds of them. " If, by 
chance," says the ordinance, " they cannot recover their 
synagogues and their cemeteries, we will have dwellings 
and lodgings given them at suitable prices^ After the 
lapse of twelve years, the king could drive them out only 
on condition of granting them a year in which to carry 

* Ordonnances des Rois de France, vol. i, pages 53 and 54. 

f D'Argentre, Histoire de Bretagne, Book iv, chap, xxiii, p. 207, 



PERSECUTION SUCCEEDED BY FAVORS. 1 37 

away their effects. Finally, he guaranteed them a certain 
freedom of person and property, which did not, however, 
prevent their being pillaged and hunted down in 1321, 
before the expiration of twelve years, under pretext of 
their connivance with lepers and even with infidels. They 
were also accused, as usual, of having poisoned the springs 
of water, and a great number of them were consequently 
burned to death. Several councils forbade them to prac- 
tice medicine, and threatened with excommunication any 
Christian who should dare have recourse to their services. 
We cannot to-day properly characterize such absurdities ; 
and yet we imitate them in our colonies towards men of 
color, to whom certain occupations are still interdicted ; 
so true it is that while times change, prejudices are slow 
to disappear ! 

The history of the Jews, therefore, presents only 
a monotonous succession of vicissitudes. In 1340, 
their debtors are forbidden to pay them ; in 1346 the 
Jews are compelled to become converted or to depart 
from the kingdom. In Italy, in Spain, in Germany, there 
are the same outrages, the same persecutions, sometimes 
suspended when the governments need their money, but 
resumed as soon as those needs are satisfied. To the 
office of Master of the Jews succeeds that of General 
Guardian, in 1359, as if these men had formed a nation in 
the midst of a nation. Then comes the captivity of King 
John, whose ransom they help to pay, and that aid is fol- 
lowed by a shower of favors. Their cemeteries are re- 
stored to them ; they are allowed to acquire houses ; they 
are exempted from aids (a special tax) and the salt-tax ; 
the judges of the king are forbidden to interfere with 
their business, and their affirmations as to what is due 
them, are to be received as authoritative. It was the 
States-general which had obtained for them these advan- 
tages. A happy and singular result, for those times, of 
the intervention of the people in the affairs of the na- 
tion ! But these fine days were not of long duration, and 



138 HISTORY OF POLITICAL ECONOMY. 

we see the Jews again forced to buy with gold, one by 
one, so to speak, the hberties which they had already 
paid for so many times. Charles VI drives them from 
France in 1393 and compels them to withdraw into Ger- 
many, where new vexations await them, to last longer 
than in any other country. What is certain is that at no 
time were they popular. The services they rendered to 
the various governments as money-lenders, were dearly 
paid for by the people, and tend to explain how they 
could be seen at almost the same moment so earnestly 
protected by some and so cruelly treated by others. The 
isolation in which they were forced to live, and the pro- 
hibition, long continued, against acquiring real estate, 
directed their speculations toward commerce and manu- 
factures, in which they soon obtained incontestable supe- 
riority. Unfortunately, they devoted themselves to these 
with a mistrust and timidity which by degrees led them 
to seek in trickery a shelter from the abuses of power, 
and thus were they led to those shameful transactions, of 
which their history presents only too many examples. 

Nothing is more curious to study than the commercial 
condition of that nation which had no territory of its 
own, nor ports, nor armies, and which, constantly tacking 
about on an agitated sea, with contrary winds, at last ar- 
rived in port with rich cargoes and immense wealth. The 
Jews traded because it was rarely permitted them to em- 
ploy themselves in any other way with security. While 
the multiplicity of toll-houses and the tyranny of the feu- 
dal lords rendered all trade impossible except that of the 
petty tradesmen of the market-towns and cities, the Jews, 
more bold, more mobile, were dreaming of vaster ope- 
rations, and were working silently to bind together conti- 
nents, to bring together kingdoms. They avoided the 
highways and the castles, carefully concealing their real 
opulence and their secret transactions under the appear- 
ances of poverty. They went great distances for rare 
products of the most remote countries, and brought them 



JEWS AS TRADERS AND LOANERS OF MONEY. 1 39 

within reach of well-to-do consumers. By wandering 
about and traveling from country to country, they had 
acquired an exact acquaintance with the needs of all 
places ; they knew where to buy and where to sell. Some 
samples and a note-book sufiliced them for their most im- 
portant operations. They corresponded with each other 
on the strength of engagements which their interest 
obliged them to respect, in view of the enemies of every 
sort by whom they were surrounded. Commerce has 
lost the trace of the ingenious inventions which were the 
result of their efforts ; but it is to their influence that it 
owes the rapid progress of which history shows us the 
brilliant phenomenon in the midst of the horrors of feu- 
dal darkness. Insensibly, the Jews were absorbing all the 
money, since this was the only kind of property which 
they could acquire and keep safely, and usury soon ap- 
peared to them as the surest means of enriching them- 
selves. Free to fit out vessels and to undertake avowed 
speculations, they would perhaps have renewed the mar- 
vels of Tyre and of Carthage : slaves, and burdened with 
contributions, they became accustomed to getting back 
by usury what was taken from them by spoliations. In 
vain were severe laws proclaimed against loans at inter- 
est ; these laws only served to make loans more dififi- 
cult and consequently interest more onerous. Lenders 
knew then as now how to elude the prescriptions which 
interfered with their projects, and their discounts were so 
much the more usurious as the risks were more serious^ 
Gradually, with the aid of a little capital, they became 
masters of all fortunes, and more than once the despair 
of their debtors massacred them as creditors rather than 
as heretics.* 

This state of things lasted until the discovery of the 
Cape of Good Hope and of America, an epoch when Ru- 
ropean nations devoted themselves to enterprises much 
more important than the peddling from house to house 

* Arthur Beugnot, Les Juifs d' Occident, 2d part, p. 35. 



140 HISTORY OF POLITICAL ECONOMY. 

of the Jews, and their speculations on short loans. But, 
for more than five hundred years, it is in the history of 
that nation that we must study the progress of commerce 
and the more or less venturesome attempts through which 
it has risen to the rank of a political power. The Jews be- 
gan by selling slaves under the first race ; they became 
also collectors of tolls (telonarii), and their abuse of that 
office was such that it had to be taken from them. Later, 
we find them established at Vienne in Dauphiny, in rela- 
tions with Marseilles for the trade of the Levant. They 
obtain, in consequence of these relations, several diplo- 
matic missions, and they fill them with ability. The monk 
of Saint-Gall mentions a certain Jew trader who had be- 
come the favorite of Charlemagne, and who went to 
countries beyond the sea in search of the most valuable 
commodities. The priests and bishops had become their 
tributaries, and more than once the sacred vessels were 
pawned to these heretics, to meet the ruinous expenses 
of the clergy. The Jews were the depositaries of the 
finest cloths known, and they traded in them at immense 
profits : they extended the use and at the same time the 
demand for them into castles and into abbeys. They 
also engrossed the trade in jewelry and in gold and silver 
bullion. Feudalism disturbed these lucrative occupations 
less than one might suppose : the lords put upon them 
strict conditions, but they had the good sense to treat 
them with respect. Besides, in the midst of the general 
terror which continually hovered around all highways and 
all travelers, the Jews, armed with safe-conducts, traveled 
over all Europe without inquietude, and in the tenth and 
eleventh centuries disposed like sovereigns of all the com- 
merce of France. At that period, they had already greatly 
simplified commercial proceedings, and their correspon- 
dence would have done honor to the most able merchants 
of our great cities. 

The appearance of the tradesmen of Lombardy, Tus- 
cany, and other parts of Italy, completed the work of the 



JEWS. ORIGIN OF BILL OF EXCHANGE. I4I 

Jews and gave an energetic impulse to the commerce of 
the middle ages. The latter, from that time, traded in 
everything, and put in circulation real and personal prop- 
erty, such as horses, lands and houses. The historian Ri- 
gord goes so far as to say that the Jews were, at that time, 
real proprietors of half the kingdom. In vain royal ordi- 
nances fixed the rate of interest, regulated mortgages, the 
mode of prosecutions against debtors, and a multitude of 
other questions of an economic importance not less great ; 
the Jews continued to loan and to sell, to those who 
needed loans and purchases, and who were only too care- 
ful not to discuss conditions. It is also claimed that it 
was at this time that the first bills of exchange appeared, 
the invention of which some trace to about the seventh 
century, and others, only to the middle of the twelfth. 
It is a point which has not yet been cleared up, and 
which is not of so much consequence as some have sup- 
posed. The date of such a discovery, even if it could be 
authentically fixed, would be of interest simply as a mat- 
ter of curiosity ; but it appears destined to remain forever 
in doubt. It is thought, and with reason, that the invention 
is rather due to the Italian traders than to the Jewish bro- 
kers of this time, the latter not having had occasion as soon 
as the others to devote themselves to trade between differ- 
rent places, which probably suggested the idea. The very 
name of letter of exchange, which was primitively Italian, 
seems to indicate their true authorship ; and the first city 
where they were used, Lyons, then the entrepot of Italy, is 
a further indication. It is probable that the Lombards 
and the Jews had an equal part in inventing them, and 
divined, from the beginning, the important consequences 
from their use.* 

* M. Courcelle-Seneuil, in a learned article that he published in Guillaumin's 
Dictionary of Polit. Econ. (1853, 2 vol. gr. in-8vo.), traced the employment of 
this commercial procedure to antiquity. We reproduce here the historical 
part of that interesting study : 

" It cannot be affirmed that the Phoenicians knew the letter of exchange. 
We know little of these people who brought writing to the Occidentals and who 
wrote little themselves, who purposely allowed an impenetrable mystery to 



.142 HISTORY OF POLITICAL ECONOMY. 

These ingenious contrivers later entered into a strife, 
and the history of the ItaHan republics of the middle 
ages is full of the debates which arose between them on 
the subject of privileges which some wished to exercise 
to the exclusion of the others. We see the Jews become 
intendants, stewards, procurators, bankers, and even 
agents in marriages, according as they are more or less 
forcibly driven from all the regular commercial positions 
by the bulls of the Popes or by the jealousy of competi- 
tors. Everything thus contributed to narrow them down 
to a vicious circle, from which they can only escape by 
usury and money negotiations. When envy has forced 
them to abandon a city, the interest of the inhabitants 
calls them back ; their capital has become so necessary to 

prevail in their industries and commercial processes, as well as in the discoveries 
of their navigators. Nevertheless, we can hardly believe that the numerous 
Phoenician trading-houses in the Indian Ocean, the Red Sea, the Mediter- 
ranean and even beyond the columns of Hercules, had between them neither 
exchange of credits, nor clearances followed by orders to pay at Asiongaber 
or at Carthage, everywhere, in short, where were found Phoenician traders 
having the same handwriting, the same language, and nearly the same laws. 

" The Athenians, who were acquainted with orders, reckoning of interest, 
bank-deposits, and the negotiation of claims, were also acquainted with what 
may be called the elementary form of bills of exchange. In his plea against 
the banker Pasion, Isokrates, speaking in the name of a young man who had 
come from Pontus to Athens to see the world and learn commerce, expressed 
himself in these terms : ' As I wished funds from Pontus, I begged Strato- 
kles, who was setting out for that country, to leave me his gold, which my 
father would refund to him. I thought it would be a great advantage to me 
not to have my funds pass over a sea infested with the pirates from Lacedse- 
mon. * * * Stratokles being concerned to know who would pay back 
his money if my father did not act in accordance with my letters, and if I 
had left Athens on his return, I took him to Pasion, who promised to pay 
him, in that case, principal and interest.' 

" Here is, in fact, a formal bill of exchange bought by Stratokles, and it 
is very probable that the trade of Athens, which had penetrated as far as 
India, and even to Serica, near China, and on the other hand as far as the 
Vistula, where it had encountered the Phoenicians, had experienced much 
earlier than the client of Isokrates, the advantage of the exchange of credits 
by means of which funds were transported, as it were, without being exposed 
to shipwreck or to the pirates of land and sea. 

"The Romans, too, knew the bill of exchange under that form. 'Let 
me know, ' writes Cicero to Atticus, ' if the money my son needs at Athens can 
be sent him by way of exchange or if it is necessary for it to be taken to 
him ' {^ permtitarine possii, a?t ipsi ferendum sit.') This passage, in vyhichthe 
letter of exchange is designated almost by name, does not permit a doubt of 
its existence in ancient times. 

" It is true that neither the Roman laws, at least those which we possess, 
nor history, contain exact information in regard to the bill of exchange. 
But as we have already said, history, which, in our days, ordinarily neglects 



LOAN-BANKS. CRUSADE AGAINST JEWS. 143 

these industrial cities that the orders of the authorities 
are disregarded to prevent the Jews carrying it elsewhere. 
Moreover, soon houses for loaning money are started 
even in the villages; and the Jews of Tuscany direct 
from a central point a multitude of branch-houses of 
their establishments at Florence and Pisa. Their opu- 
lence and their magnificence surpassed imagination, and 
aroused against them fanatical adversaries. We know 
the history of that famous Bernardin de Feltre, who 
carried his enthusiasm so far as to preach a crusade 
against them, and who on every occasion showed himself 
their most implacable enemy. He pursued them every- 
where as usurers thirsting for the blood of the people : 
and, to ruin their establishments, he conceived the idea 
of opposing them by the formation of those houses for 

commerce, concerned itself still less with it in those remote times. Besides, 
every branch of business, every council of state, and bankers at least as much 
as others, had colleges or fraternities, and their secrets, in all antiquity 
and during the middle ages. The operations of exchange, like other bank- 
ing operations, were governed by laws of their own, by unwritten customs 
and usages of which the initiated alone had the secret, and of which legisla- 
tors and society in general were entirely ignorant. 

" We need not be surprised that the Jews preserved better than others the 
secret of the bill of exchange ; for, from the time of the first Csesars, they 
were scattered over the whole empire, as the Acts of the Apostles bear wit- 
ness, and they traded almost exclusively in the precious metals and in 
moneys. The Jews were obliged to carry with them bills of exchange, as 
well before as after their expulsion in 1181, a simple incident of the long 
persecution of which they were the object during fifteen centuries. 

" In the middle ages, as previously, we find the bill of exchange wherever 
commerce is flourishing ; at Amalfi, at Sienna, at Florence, and in the Hanse- 
towns of the Rhine and the Elbe. In 1255, says Mathieu Paris, Henry III, 
King of England, having need of money for his second son, Edmund, 
charged by the Pope to conquer the states of the house of Suabia in Italy, 
negotiated a loan with some merchants of Sienna and Florence. Its ma- 
turity having arrived and the king not knowing how to meet it, the bishop 
of Hereford, Egeblank, showed him a convenient way. He advised him to 
discharge the debt by drawing bills of exchange on the bishops of England 
through the Italian merchants, to the amount of the loan ; and this advice 
was followed. In vain the bishops protested and said they had done no act 
of commerce ; they were condemned to pay, by the tribunals of the Pope, 
who had approved the expedient. Such is the curious though scarcely com- 
mercial use that was made of bills of exchange in the thirteenth century. 

" But neither in the middle ages nor in ancient times have we found 
any trace of endorsement and its consequences. 'The Jews.' says Sa- 
vary, ' found a way to withdraw their effects, which they had confided to 
the hands of their friends, by secret letters couched in terms short and pre- 
cise, and that through the mediation of travelers and foreign merchants. > 



144 HISTORY OF POLITICAL ECONOMY. 

loaning on pledges, which are called monts-de-pi^t^. At 
the beginning, everything was free in them, and the sums 
lent were without interest, while the Jews sometimes de- 
ducted beforehand an interest of 30 to 40 per cent. More- 
over, their success was prodigious, and most of the cities 
of Italy had their monts-de-pi^t^, which were one day to 
surpass in usurious exactions the boldest operations of 
the Jews. 

However, these monts-de-pi^t^ could not fill the place of 
the establishments of the Jews, and this circumstance 
proves with what shrewdness the latter had truly divined 
the wants of the monetary circulation. Although the monts- 
dc-pze^/ loaned money almost without interest, the formal- 
ities which it was necessary to undergo in order to have 
a right to their help, the inevitable delays in their admin- 

Thus these bills of exchange were not even drawn for the benefit of the 
bearer, like that of Stratokles, they were, to speak accurately, only advices 
for clearing the accounts, and we question whether the exchange relations 
introduced into Amsterdam by the exiled Lombards, were anything dif- 
ferent. 

" The formula of a bill of exchange of the 1st of February, 1381, which 
M. Nouguier adduces in his treatise, contains no name of the remitter, nor 
order, nor any mention whatsoever of protest or guaranty. It is a simple 
notice of clearing the account. 

" As to the rest, it is sufficient to reflect one single moment on the situa- 
tion of commerce in the society of that period and in ancient times, to com- 
prehend that the modern bill of exchange, with the endorsement of its guar- 
anties and the protest, could hardly have found a place there. Property, 
especially personal property, was so little respected then, that recourse to 
the tribunals was almost impracticable. The bill of exchange, if it had ex- 
isted, could have had currency only between a very small number of bankers 
all well known to each other and of credit so assured as never to need the 
intervention of the tribunals. 

" Thus, then, it was, that the bill of exchange entered into modern so- 
ciety. When Louis XI issued the ordinance of 1462, he made no law about 
bills of exchange : he simply authorized the merchants of the fair at Lyons 
to make use of them, as if that had been previously interdicted. The ordi- 
nances which established or rather recognized in 1549 the consular jurisdic- 
tion of Toulouse, and in 1563 that of Paris, attributed to these jurisdictions 
the knowledge of all contests relating to bills of exchange, and we must 
seek in these tribunals for the commercial law of the times, which was 
custom. 

" The modern bill of exchange, with the endorsement and its consequent 
obligations, can have originated no farther back than the great commercial 
movement which marked the end of the fifteenth century, and it did not 
take its place in French law until the ordinance of 1673, at the very time 
when commerce was increasing in France in civil society and engrossing 
public attention." Did. de /' Econ. Pol. Article, Lett7-e de change. 

(Note of French editor.) 



MONTS-DE-PIETE. HS 

istration, the necessity of proving the legitimate possess- 
ion of the articles pledged, and above all, the obligation 
on the part of depositors to make known their names, 
soon kept away borrowers, who could obtain funds at 
any time, in secret and without formalities, from the 
Jewish bankers. Rich and poor, lords and villeins, 
hastened to them, and their credit was so great at Leg- 
horn, in the times of the Medicis, that the saying became 
proverbial : " // is better to beat the Grand-diike than a 
JewT Pope Sixtus-Fifth had opened again to them all 
the sources of wealth which his predecessors had closed ; 
their goods were even exempt from every toll, the sacro 
nionte della pieta ceased to compete with them, when the 
Christians in charge had surpassed the abuses of their ri- 
vals. After less than ten years of existence, the monts- 
de-pie'te had become what they are to-day, open pits un- 
der the steps of misfortune rather than asylums to es- 
cape it. 

Everything then seems to warrant the belief that the 
Jews exercised a notable influence on the course of politi- 
cal economy in Europe, by keeping in charge, in the midst 
of feudal anarchy, the commercial traditions destined to 
become perfected and refined in the atmosphere of the 
fifteenth century. It is to the persecutions of which they 
were victims that we are indebted for the first attempts 
at credit and the system of circulation. They alone, per- 
haps, by concentrating on trade in gold and silver an at- 
tention which the prejudices of their contemporaries pre- 
vented them from giving to anything else, prepared the 
way for the great monetary revolution which the discov- 
ery of the mines in America and the establishment of Eu- 
ropean banks were to accomplish in the world. Thus the 
luminous trace of the future shines and is preserved, in 
the midst even of the darkest events ; and we shall fol- 
low it, still more marked, in the history of the Hanse 
towns. 



CHAPTER XVI. 

The Hanse towns. — Cause of their association. — Singular organization of 
their trading-houses. — Importance of the enirepdt of Bruges. — Origin of 
commission-trade. 

While the Jews were creating and extending com- 
mercial science in Europe in spite of feudal anarchy and 
the constantly renewed persecutions by which they were 
oppressed, a powerful association was forming in Ger- 
many and completing the work of the crusades after hav- 
ing anticipated it. The north and the south march thus 
in concert to the conquest of the great elements of public 
wealth, and the genius of production finds ever an asy- 
lum from the abuse of power and the exactions of 
tyranny. This progress is not easy to follow through the 
vicissitudes which incessantly agitate European society 
from the reign of Charlemagne to that of Charles V, but 
it is impossible to misinterpret the efforts which have 
been constantly made in one country or another, to re- 
store to the laborer his rank and to labor its prerogatives. 
Even while crushing him, people have rendered homage to 
him ; and the history of the Jews, incessantly proscribed 
and recalled, is only a series of gropings, to the necessity 
for which the governments submit before arriving at the 
employment of credit, that is to say, an inviolable respect 
for their pledged word and for property. The estab- 
lishment of the Hanseatic League is one of those labo- 
rious attempts, and must take its place in the history of 
political economy. 

146 



ORIGIN OF THE HANSEATIC LEAGUE, I47 

Of the first days of that celebrated association there 
exists no authentic monument from which one can 
determine the precise time of its formation. Most of the 
acts of accession to the Hanseatic Union have even dis- 
appeared from the archives of the principal cities which 
constituted a part of it. No record of the deliberations, 
no official report of the conferences has come down to us 
from the early days of these opulent cities, more occu- 
pied in acting than in speaking and writing. What is 
certain is that at the beginning of the thirteenth century, 
several maritime cities of lower Germany are found al- 
ready united for their common defense, and above all, for 
the protection of their commerce. " Their beginnings 
were feeble," say the learned historian of these cities,* 
" their progress rapid, their success astonishing, and 
doubtless they were far from foreseeing that some day 
their opulence would have sovereign sway over the two 
seas of the north, and would weigh heavily in the political 
balance of Europe." The first treaties that they made 
with each other, aimed at the repression of piracy and the 
abolition of that brigandage known under the name of 
wrecker s rights then pitilessly exercised against all navi- 
gators. As their profits extended, it became necessary 
to protect them from the maritime depredations, which 
corresponded in cruelty with the exactions of the territorial 
barons. They obtained by purchase privileges which 
they could not obtain by good right or by force. By com- 
bining, they acquired more influence, and little by little 
they had placed upon solid bases numerous franchises 
which became the source of all kinds of prosperity. 

The crusades soon offered active support to the 
spirit of enterprise of the Hanse-towns. Their ships 
took part in the expeditions to the Holy-Land and often 
visited the Mediterranean ; on more than one occasion, 
they landed bold passengers, who easily recognized the 
superiority of commerce from long voyages, over the poor 

* Sartorius, History of the Hanse Towns, vol. i. 



148 HISTORY OF POLITICAL ECONOMY. 

and restricted coast-trade of the Baltic. At the West 
and in the North Sea, Cologne, Bremen, Liibeck and 
Hamburg, obtained grants of important privileges. The 
favor had been accorded them of organizing themselves 
into a corporation in London, and of having there a com- 
mercial house and ware-houses, and they made such good 
account of it, that, in less than fifteen years, all the English 
commerce had fallen into their hands. In Sweden, Den- 
mark, Norway and Livonia, their preeminence no longer 
knew any limits, and even to Novgorod the Great, the 
magistrates of Liibeck exercised a respected influence over 
the Hanseatic branch-of^ces. At the end of the thirteenth 
century, seven maritime cities of the Baltic are already uni- 
ting to defend some privileges which the king of Norway 
determined to contest with them in his ports : they arm a 
fleet to secure these privileges, and triumph over the op- 
position of the prince. In the following century, their 
preponderance is so great that most of the cities of the 
interior of Germany, as well as entire provinces, decide 
to join them. All wish to belong to that association 
where there are such large profits to be made and 
so few risks to run. The small cities are admitted into 
it with a right to protection on condition of bearing their 
part of the general expenses, as the price of their new 
independence. It is believed that the first act of general 
confederation was drawn up in an assembly held at Co- 
logne in 1364, in which the league took the name of Han- 
seatic, or of Hanse, which signified, in the old language of 
the country, corporation. One thing is certain, namely, 
that from that time we no longer hear of the traders of 
the empire, nor of the German navigators, but of the 
trading houses and factories (buildings occupied by fac- 
tors, who conducted trade in foreign parts. — Trans.) of 
the Hanse towns. 

Unfortunately, this league bore within it germs of dis- 
organization which would soon or late bring about its de- 
cadence and ruin. It lacked an executive power provided 



HISTORY OF THE HANSE. LIST OF TOWNS. I49 

with means sufficient to compel all the members to sub- 
mit to the resolutions adopted by the majority ; it had 
no chief appointed to direct its forces for the general 
good. " It was a body with a hundred arms, without a 
head." * In vain had they stipulated that refractory cities 
should be cut off from the confederation, and that their 
differences should be judged by a supreme council ; these 
essential clauses were never scrupulously executed, and no 
idea of perseverance and unity ever guided the enter- 
prises of the league. The spirit of anarchy which then 
dominated in Europe had also breathed upon it, and 
we cannot understand how each of the cities of which it 
was composed could have kept the right of contracting 
alliances with princes or states foreign to the confedera- 
tion. Besides, it more than once happened that the in- 
terests of one or of several members of the league were 
found to be in opposition with those of all the others, 
and brought on wars disastrous to the entire association. 
The kings of Denmark, Sweden and Norway, and all those 
feudal powers accustomed to tributes and to pillage, at 
last looked with unfriendly eyes upon the independence 
of a few commercial cities and the insolence of the bour- 
geoisie which resulted from it. The latter, becoming by 
degrees more powerful as they became more rich, could 
take into their service the subjects of even their enemies, 
and they opposed a commercial and moneyed aristoc- 
racy to the purely feudal aristocracy which made war 
upon them. They were fortified, and could resist in 
those times when artillery, as yet unknown, could make 
no breach in their walls.f 

* Schoell, Cours d' Histoire des Etats Europeans. Vol. xv, p. 291. 

f The names of all the Hanse towns have never been certainly known. 
The most famous of those habitually designated in the official acts of the 
confederation, were not more than forty or forty-five. They were Liibeck, 
Wismar, Rostock, Stralsund, Greifswalde, Colberg, Anelam, Demmin, 
Stettin, Kiel, Bremen, Hamburg, Mustargard, Culm, Thorn, Elbing, Dant- 
zig, Kosnigsberg, Riga, Dorpt, Revel, Pernow, Cologne, Soest, Milnster, 
Osnabruck, Brunswick, Magdeburg, Hildesheim, Hanover, Liineburg, 
Utrecht, Zwolle, Deventer, Zutphen, Zierikzee, Briel, Middelburg, Dor- 
drecht, Rotterdam, Amsterdam, Campen, Groningen, Harderwick, and 



150 HISTORY OF POLITICAL ECONOMY. 

Their power was not slow in manifesting itself in the 
first contests they had to maintain, namely, against Wal- 
demar, king of Denmark. They forced this king to flee 
from his dominions, and they spread such terror in the 
Baltic, that all the rival powers were humiliated before 
their triumphs. Thus disappeared the fleets of those re- 
doubtable Northmen, who had held all Europe in check 
and founded kingdoms at more than five hundred leagues 
from their coasts. The squadrons of the Hanseatic 
League, commanded by senators from Liibeck, purged the 
seas of the North from pirates, and the treaty of Stral- 
sund, in 1370, delivered into their hands for fifteen 
years the strong places of Scania, with the outlying 
districts. At this time, it may be said that the commer- 
cial law of maritime nations began its existence, and that 
commerce gave law to barbarism. Wherever the flag of 
the Hanse towns floated, respect for treaties was seen to 
succeed abuse of power. Commercial agencies, entre- 
pots, counting-houses and warehouses were established 
at all points where the exchanges could be of any im- 
portance. Russia was really discovered by these bold 
navigators, who were the first to open a route as far as 
Novgorod. The natural products of these vast, fertile, 
though badly cultivated regions, became, and have re- 
mained since then, the principal object of the commerce 
of the Baltic Sea. They were skins, hides, peltry, grain, 
hemp, tar, and timber of kinds which Europe lacked and 
which the Hanse towns furnished almost immediately in 
abundance. The most perfect freedom reigned among 
these cities in transactions which to-day are fettered by 
the exigencies of public policy, custom-duties, and all 
the delays caused by mistaken zeal for the interests of 
the public treasury. 

If one transport himself in thought to our modern 
counting-houses in the Orient or in China, he will 

Staveren. The others were designated by the general name of Hanse towns. 
Their full number may be estimated at eighty. (Note of French editor.) 



ORGANIZATION OF THE HANSE ESTABLISHMENTS. 151 

recognize the traces of commercial usages which the 
Hanse towns made prevail in all Europe in the thir- 
teenth and fourteenth centuries. In England and Rus- 
sia, their traders enjoyed considerable privileges. They 
had at Novgorod a magistrate charged with main- 
taining order among them, and judging their cases ac- 
cording to the laws of the Union. This magistrate, 
assisted by a few experienced men, had the right to 
pronounce in certain cases heavy fines, and even the 
penalty of death, with appeal either to Liibeck, or to 
the Hanseatic Diet. The church and the factory of the 
Union were surrounded with an enclosure shut during the 
night and strictly guarded. The merchants of the Hanse 
had taken care to secure for themselves the monopoly of 
business. The Russians could sell only to them ; and a 
statute of the confederation had forbidden the balances 
on accounts to be paid in specie. All the transactions 
were to be consummated by way of exchange. Hence 
arose contrabandage and interloping, now by Sweden, 
now by Finland, until the time when the English, having 
found the way to Archangel by the White Sea, annulled 
in fact the monopoly of the confederation. Besides, the 
bond was by degrees tending towards dissolution ; and 
from this time, we see one city after another become de- 
tached from the Union, at the head of which Lubeck 
long shone with the greatest brilliancy. 

To comprehend well the influence exercised by the 
Hanse towns on the development of the science of 
wealth, it is necessary to glance at the manner in which 
these cities had organized their branch establishments at 
Novgorod, Bergen, Bruges, London, and other places. 
All these were subject to the same rules, if we except a 
small number of local modifications. These branch- 
houses were composed of a series of buildings which 
were isolated and generally constructed on the sea-shore 
or on the banks of rivers, so that ships could easily ap- 
proach to take in or to discharge their cargoes. Each 



152 HISTORY OF POLITICAL ECONOMY. 

body of buildings had a particular name and destination. 
The employes and the inspectors lodged within reach of 
the merchandise, which was distributed according to its 
nature, into granaries, store-houses, or cellars, as in the 
present docks of the city of London. Vast gardens served 
at need as a supplementary place of deposit and furnished 
the vegetables necessary for the consumption of the resi- 
dents. During the winter, a common hall brought that 
numerous industrial family together about the same fire- 
side ; vast dormitories received them afterwards for the 
night. No residents of the establishment could marry, 
and the infraction of that law was punished by the loss 
of the Hanseatic right and of the freedom of the city. 
Imagine the rules of a religious community applied to a 
commercial association, and you will have an idea of the 
constitution of these factories, the principal provisions 
of which are reproduced in our day, with some few differ- 
ences, in those of the English at Canton. 

As it is to-day* at Canton, it was forbidden the em- 
ployes to visit, under pe7talty of death, the part of the city 
which belonged to the native inhabitants. The vicinity 
of the buildings was patrolled by sentinels during the 
night, and guarded by enormous dogs which threw them- 
selves furiously upon every stranger who approached 
them. It appears, also, that the rules of the confedera- 
tion did not permit the employes to do any trading on 
their own account ; they were considered only as clerks 
acting in the name of their principals, and at the expira- 
tion of ten years, they returned to Germany, rich in ex- 
perience and the knowledge they had acquired. To meet 
the expenses of the establishment, each commodity paid 
a light import and export duty. The avails of the fines 
for violation of statutes or of required forms, were ap- 
plied to the same purpose ; and each confederated city 
was subject to a tax for the maintenance of these trad- 
ing-houses. 

The trading-houses extended their ramifications for 

*«■..?.. 1837. 



PROSPERITY OF THE HANSE. SECESSION. 1 53 

a brief time throughout all Europe, and gave every- 
where an extraordinary impulse to commerce and manu- 
factures. The factory of Bruges became the entrepdt 
of all the productions of Europe, and the city contained 
as many as thirty-five thousand houses. During the 
finest days of their prosperity, the Hanse cities were 
mistresses of the fisheries, mines, agriculture, and man- 
ufactures of all Germany. The grain, wax, and honey 
of Poland, the metals of Bohemia and Hungary, the 
wines of the Rhine and of France, the wools and the tin 
of England, the linens of Holland, and the cloths of Bel- 
gium were exchanged in enormous quantities in their 
markets. The merchants of the south sent to the en- 
trepot of Bruges the products of the Orient and of Italy, 
the spices of India, the silks, and the drugs, of which the 
consumption was very considerable. But soon the pros- 
perity of that city excited the jealousy of the other 
cities which contributed to the heavy expenses of her 
employes, and Cologne broke the bond which bound her 
to the league. The administrators of the grand factory 
had committed the error of establishing two categories of 
merchandise, of which one class was to be negotiated for 
only at the depository of the confederation, while the 
other was free from that condition. By degrees, an at- 
tempt was made to increase the number of free commodi- 
ties, that is, to make what is to-day called the fictitious 
entrepot exceed the real e^ttrepot. The struggle which 
this effort occasioned decided several merchants to con- 
sign their merchandise to Flemish houses, to escape the 
demands of the entrepots, and thus, from a protest 
against the arbitrariness of the tariffs, the commission- 
trade arose, the destinies of which were to be so bril- 
liant. 

The English, in their turn, grew impatient of the privi- 
leges they had accorded to the Hanse towns, and in fact 
these privileges were excessive. It had been stipulated 
that suits between English and Germans should be sov- 



154 HISTORY OF POLITICAL ECONOMY. 

ereignly judged by two magistrates whom the king should 
appoint : the Germans had been removed from the juris- 
diction of the court of the admiralty. A quarter in Lon- 
don had been left to them as sole proprietors, another in 
Boston and one at Lynn, and they were exempt from a 
series of custom duties and other taxes to which every 
other party was subjected. The quarrel began to grow 
bitter, when the English perceived that those from the 
Hanse towns were profiting by their privileges, to flood 
the country with cloths manufactured in Germany, and to 
monopolize all commercial operations. It was demon- 
strated that the Germans had imported in a single year 
forty-four-thousand pieces of cloth, while the English 
manufacturers had been able to dispose of but eleven- 
hundred. Later, Queen Elizabeth favored with all her 
influence the progress of the establishments which the 
adventurers * had founded to rival the Hanse towns, and 
she put the seal of her authority on those custom-house 
reprisals which may be considered as the prelude of the 
industrial struggles of the present time. From that mo- 
ment, commerce rises to the rank of a political power : 
tariff battles are fought as well as artillery battles, and 
political economy makes its formal entrance into the 
councils of kings and into European law. 

The Hanse towns rendered immense service to this 
movement so favorable to freedom and civilization, in 
uniting nations by the powerful bond of interests and 
trade. The establishment of the entrepdt of Bruges, 
which united the North and the South, had become the 
rendezvous of all the merchants of Europe and a place 
of the first rank in the circulation of specie and operations 
in credit. There were sixty-eight trade bodies there ; 
and at the commencement of the fourteenth century,f 
there existed in that city a marine assurance company 

* It was under this name that a company of English merchants was form- 
ed, for destroying the commercial sway of the Germans, 
f In 1310. 



SERVICE RENDERED BY THE HANSE TOWNS. I 55 

and brokers acquainted with the principal rules of ex- 
change.* Hence went forth as from a common centre 
the orders of that commerce which would have awakened 
industrialism from the lethargy in which it was plunged, 
if the system of corporations, then in vigor throughout 
Europe, had not contributed to keep it in that condition. 
And yet, the Hanse towns created the system of the 
modern fisheries, both herring and whale, the merchant 
marine, the entrepots, commission, and franchises of the 
kind which the Europeans enjoy in the Orient and in 
China, for lack of better. They accustomed feudal bar- 
barism to respect labor to which it finally became tribu- 
tary, and they substituted the influence of industrial and 
economic intelligence for that of the cuirass and the 
sword. They prepared the way for the emancipation of 
the common people of France and England, by making 
it evident on which side the power would be, whenever 
the commons would have an understanding and act in 
concert. Finally, we owe to them the abolition of the 
first commercial barriers, and the first attempts at public 
credit, of which they set the example whenever the ne- 
cessities of the confederation compelled them to resort to 
it. The representative and elective system which they 
propagated, the sort of hierarchy which they established 
between the allied cities, protected or in subjection, 
trained each one of them in the defense of its rights, 
and led them to the conquest of new rights. Thus the 
trace of economic progress continually reappears, in the 
midst of the vicissitudes of the nations which seem ta 
have lost it, and the productive forces in man continually 
prevail over his destructive propensities. 

* As the inhabitants of the Hanse towns were commonly designated in 
England under the name of Esterlings, and in sales it was stipulated that 
payment should be made in money of the Esterlings, it is probable that the 
denomination of pound sterling dates back to that period. — Fr. Ed. 

"The term sterling seems to have been applied in consequence of its use 
among the Ripuarian Franks, sometimes called the Esterlings." — Chambers's 
Encyclopaedia. 



CHAPTER XVII. 

The Affranchisement of the Communes and its influence on the course of 
economic and social progress. 

While the Hanse towns were organizing into a con- 
federation in the north, the great work of the affranchise- 
ment of the communes was being accomplished in the 
south. The Roman traditions had become more deeply 
rooted there than in the rest of Europe, and even under 
the domination of the Barbarians, the great cities of Pro- 
vence and Languedoc had never ceased to enjoy the ben- 
efits of a municipal government. Gradually, as the cities 
of the north acquired importance by their wealth, they 
made attempts to conquer their independence. They 
wished to be free in the disposition of their fortune, and 
to connect with it some privileges, as at that time it was 
considered an evidence of servitude not to have any. 
The bourgeois obtained that of being judged by their 
peers and escaping the oppressive, partial, and venal juris- 
diction of the lords. They claimed the right of being 
taxed in a fixed and limited manner, of themselves mak- 
ing laws concerning their interests, and of maintaining 
order in the cities and market towns. " See," said the 
abb^ Guibert, a chronicler of the twelfth century, *' see 
what they mean to-day by this new and detestable word 
commune ; people subject to the villein-tax pay rent no 
longer to their lords more than once a year; if they com- 
mit any offense, they are cleared on the payment of a 
penalty fixed by law : and as to the levies for money that 

156 



CAUSES OF AFFRANCHISEMENT. I57 

are usually imposed upon serfs, they are exempt from 
them." * 

This was the aspect of the new-born freedom to a 
churchman. The church had reason to be alarmed at 
the universal conspiracy which broke out against all privi- 
leges, and which would soon attack its own. For it had 
by degrees substituted itself for the lords in obtaining 
exemption from taxes, and fiscal prerogatives of the high- 
est importance. Every day its wealth was increased by 
donations, and its pretentions rose with its fortune to the 
point of even making kings uneasy upon their thrones. 
Louis IX himself, who was a saint, was obliged to bring 
them to reason ; and his successors, frequently excom- 
municated, had to maintain long struggles with the pa- 
pacy, at all times the natural protector of ecclesiastical 
demands. Thus was continued that' permanent, immortal 
protest of the human race in favor of a more equitable 
distribution of the profits of labor. The church had 
joined in it in the days of her misfortunes, and had fur- 
nished powerful weapons to the defenders of civil equal- 
ity at a time when all the world was bending under the 
feudal yoke. But, as feudalism grew weaker, the church 
desired to become its heir, and to resume her old au- 
thority over the» kings, who, consequently, threw them- 
selves into the arms of the people and created the third 
estate from the affranchised communes. 

This great revolution was not the work of a day ; we 
see its results, but we do not know the precise date. It 
is probable that the movement began in some opulent 
cities, and was insensibly propagated, according to cir- 
cumstances, throughout all the towns; some of which de- 
manded the confirmation of the privileges they had long 
possessed, and the others argued of services rendered and 
deeds accomplished, in order to obtain a grant legalizing 
what they had already won by conquest. The first char- 
ters of emancipation are generally attributed to Louis le 

* Memoires de Guibert, Book iii, chap. 7. 



158 HISTORY OF POLITICAL ECONOMY. 

Gros, because he was the first king who had recourse to 
the support of the bourgeois to resist the usurpations of 
the nobility. But it would be an error to suppose that 
at the time when the various cities constituted them- 
selves into communes, they possessed no local insti- 
tutions of the people, charged with watching over the in- 
terests of the inhabitants. They had mayors, aldermen, 
peers, jurors, and consuls. We know of the energetic and 
celebrated struggle which the inhabitants of Vezelai main- 
tained against their abbot and his monks, who claimed 
the right to keep them forever under the feudal yoke. 
Nothing in history is more curious than that long quarrel 
between monks speaking in the name of the liberties of 
their church, and a few bourgeois who claimed on the 
other side the privileges of their commxune — a serious dis- 
pute which lasted several years, and in which bishops, 
lords, the court of Rome, and the king of France, inter- 
fered for the ruin and enthralment of a paltry market 
town. The cities of Tournay, Noyon, Meaux, and Dijon, 
enjoyed very extended privileges, in the foremost rank 
among which always figure certain commercial liberties, 
and some special prerogatives in the matter of roads, 
moneys, corv^es, and taxes. The abbe Suger, who was 
minister, and who wrote a biography olf Louis le Gros, 
expressly * says that the men of the parishes of the coun- 
try assisted this prince at the siege of Thoury. Later, 
Queen Blanche, during the absence of Saint Louis, en- 
trusted the defense of cities to the bourgeois militia. 
The more one studies this subject, the more is he con- 
vinced that it was the accumulated wealth in the cities 
which gave rise to ideas of liberty and led to the af- 
franchisement of the communes. 

If these communes did not form, as in Germany, a gen- 
eral confederation, it was because they found a support 
in sovereigns as interested as themselves in humbling the 

* Suger, De Vitd Ludovici Grossi ; in Duchesne, Hist, franc, script, vol. 
iv. p. 301. • 



ALLIANCE OF KINGS AND COMMUNES. 1 59 

power of the barons. Royalty could do nothing entirely 
alone against that multitude of lords intrenched in their 
castles, who exploited the resources of France for their 
personal advantage. Neither could the communes do 
anything without the support of the kings ; there was 
between them and the latter a virtual alliance, which 
contributed not a httle to the foundation of independence 
and national unity. The Chronicles of Saint-Denis have 
celebrated the devotion of the cities of Corbie, Amiens, 
Arras, Beauvais, and Compiegne, which sent their con- 
tingents to the. battle of Bovino. Royalty had the good 
judgment to declare free the cities subject only to its au- 
thority, and that intelligent resolve secured it a great 
amount of devotion, which was not always paid with in- 
gratitude. I would not dare affirm that the kings and 
cities thought, in acting thus, that they were conforming 
to a system, and laying, by common accord, the basis of 
a new social order ; but the movement was so rapid that 
history can scarcely follow its progress, and is still, in our 
day, endeavoring to investigate its causes. 

We cannot, however, deny that this revolution was 
due to the influence of wealth and labor, which, later, 
took advantage of it to march on to new conquests. 
There was effected in Europe about that time a renova- 
tion, the dawn of which dates back to the first crusades. 
We might say that ideas were everywhere broadening and 
rising higher; the human mind was becoming emanci- 
pated under the protection of the great principle of asso- 
ciation. In the south, people were uniting for the con- 
quest of the Holy Land, and in the north for the security 
of commerce. Art and trade corporations, formerly un- 
known, were multiplied so numerously that it was soon 
necessary to make regulations concerning them, lest they 
should make war upon each other and become a danger- 
ous power in the state. Everywhere labor was restored to 
honor ; the municipal magistracies were veritable syndi- 
cates ; the aldermen and the prevosts of the tradesmen 



l6o HISTORY OF POLITICAL ECONOMY. 

were the equals of the lords, and controlled public opinion 
and the power of the cities. Read the ordinances of the 
first five or six kings of the third race ; you will find a 
great number devoted to matters of political economy, 
fairs, markets, moneys, exchanges, sales and purchases, 
weights and measures, freedom of trade, and especially 
to the privileges of the communes. Royalty governs 
seriously : it puts its hand to all affairs, and the science 
of administration is principally manifest in the new and 
bold manner in which it approaches economic questions. 
We shall soon see with what firmness Saint Louis stated 
them, if he did not have the time or the good fortune to 
resolve them : and one will be surprised at the immense 
work accomplished in his reign, notwithstanding the ex- 
ternal preoccupations of the crusades and the internal 
struggles of the feudal spirit against royalty. " We know 
that kings have long hands ; " said Abb6 Suger in his life 
of Louis le Gros ; and Saint Louis had still longer ones 
than his predecessors. 

We experience a lively interest in seeing thus arise from 
the darkness of the middle ages the first rays of that 
bright fire of the arts and manufactures, which was at 
the same time the effect and the cause of our municipal 
liberties. The communes took the names of conjura- 
tion, friendship, confederation, and fraternities, which in- 
dicated clearly the aim of their existence and organiza- 
tion. They each provided themselves with a tower with 
a belfry, to give the signal for assembly or for bat- 
tle : they gave themselves a guard and magistrates: they 
had a municipal treasury and a communal' seal, distinctive 
marks of their power and individuality. They interdicted 
the erection of any fortress capable of disturbing them, 
within reach of their walls ; and in all cases, they exer- 
cised local sovereignty. The example of the Italian re- 
publics and that of the Hanse towns, which were also 
communal powers, taught them how to make that sov- 
ereignty respected. To properly comprehend the economic 



CLAIMS OF LORDS. COMMUNAL FRANCHISES. l6l 

importance of communal affranchisement, we must con- 
sider to what hard necessities the inhabitants of the cities 
and market-towns were subjected. The lords had the 
pretention to claim unlimited credit from all the bour- 
geois : often, too, they took whatever suited their con- 
venience, without ever paying; and, as every one knows, 
this was the one of their old habits which the aristocracy 
found it hardest to give up. We see the bourgeois (those 
of Soissons among others) stipulate in their charter that 
the inhabitants of the city shall not give more than three 
months credit to the bishop, and that, if he does not pay 
at the time agreed, all farther credit shall be refused him. 
The trade associations, which have appeared since then to 
present a purely industrial character, were bodies essen- 
tially devoted to the maintenance of the liberties of the 
commune : their aim was, to escape from annoyances by 
the nobility and to defend themselves against the forced 
loans, which, under the appearance of liberty, would have 
renewed for them all the miseries of servitude. 

The communal privilege differed from municipal fran- 
chises in that the royal sanction was necessary to it and 
conferred upon it great power. Sometimes it was ac- 
quired by composition with the feudal lord, who granted 
it for a money compensation ; but as this privilege in- 
volved serious modifications in the financial situation of 
the cities, either by reducing or suppressing the payments 
they had to make to the barons, the latter frequently 
offered much resistance to the attempts of the bourgeois, 
who were obliged, from time to time, to resort to shrewd 
management i-n order to conquer them. We read in a 
communal charter accorded to the inhabitants of Dour- 
lens, " that this charter is granted because of the injustices 
and annoyances practised by the powerful against the 
bourgeois of the above-mentioned city." Philippe-Au- 
guste said, on granting a charter to the city of Saint-Jean 
d'Angely, that he favored it with all his heart, in order that 
the inhabitants might better defend and guard Jiis rights 



l62 HISTORY OF POLITICAL ECONOMY. 

as well as theirs.^ This fact is certain, that freedom ad- 
vances with the same step as labor, and no epoch has 
been more fruitful at the same time in industrial develop- 
ments and in social conquests, than that upon which we 
are entering. M. Guizot has observed,f as a striking 
proof of the general movement of minds toward reforms, 
that, in the twelfth and thirteenth centuries, there were 
found two hundred and thirty-six government acts relat- 
ing to communes, viz., nine under Louis le Gros, twenty- 
three under Louis VII, seventy-eight under Philippe- 
Auguste, ten under Louis VIII, twenty under Saint 
Louis, fifteen under Philippe le Hardi, forty-six under 
Philippe le Bel, six under Louis X, twelve under Philippe 
le Long, and seventeen under Charles le Bel. Now, if 
one considers that kings were not the only ones who gave 
charters and intervened in the affairs of the communes, it 
will be easy to conceive the importance of the change 
which had taken place in the condition of the people. 

This revolution, for it was one, was the direct and im- 
mediate result of the immense creation of wealth due to 
the industrial cities of the middle ages. The barons, pos- 
sessors of the soil, disdained to engage in any laborious 
occupation and left to the bourgeois the care of providing 
for their needs and their pleasures. By degrees, the 
money obtained by these lords, by means of taxes or 
pillage, became heaped up in the coffers of the city 
people, in exchange for wools, silks, gloves, helmets, and 
articles of luxury, for which the aristocracy were eager. 
" The lords were prodigal ; the bourgeois, on the contrary, 
passed for being very avaricious ; " % and it is not sur- 
prising that by their savings they thus created a consider- 
able amount of capital which acquired great value, thanks 
to the security strengthened by the affranchisement of 

* " Ut tarn nostra quam sua propria 'jura melius possint defendere, et magis 
integre custodire." 

f Cours d' Histoire Moderne, vol. v, p. 132. 

X Capefigue, Histoire de Philippe- Att-gusie, vol. iv, p. 243. 



ESTABLISHMENT OF COMMUNES. 163 

the communes. One finds evidence of it in Joinville : 
'* There were so many malefactors and thieves around 
Paris, that the whole country was full of them. The 
king, who took great pains that the poor be well cared 
for, knew the whole truth: he ordered an investigation 
throughout the kingdom in order that ' good and strict 
justice ' should be done, which should spare the rich no 
more than the poor. The land then began to improve, 
and people came on account of the good administration 
of law, and so much was business increased and improved, 
that sales, seizins, purchases and other things were worth 
double when the king took the lead." 

We see communes almost simultaneously established 
throughout Europe, in Italy, Spain, Germany, France, and 
England. They are everywhere, because everywhere man- 
ufactures and commerce resume their importance. Genoa, 
Florence, Venice, Barcelona, Bremen, Lubeck, Hamburg, 
Bruges, Paris, Lyons, Marseilles, London and Bristol 
seem for a time governed by the same laws. In them 
personal property stands proudly side by side with land- 
ed property and claims its rights. The land, henceforth in- 
capable of sufficing by itself alone for the needs of the new 
social condition, begins to lose its prestige, and to behold 
a part of the power of the landholders pass into the hands 
of artisans. Democracy appears, strong from the spirit of 
association and all the resources of organized and dis- 
ciplined labor. The third-estate is established : the mid- 
dle class, dreamt of in olden time by Plato and by 
Aristotle, becomes a deliberating body, grants or re- 
fuses subsidies, judges itself, guards itself, governs itself. 
Population increases with the means of subsistence. 
Arts and manufactures become improved, commerce 
gives the signal for the general bringing of nations nearer 
to one another, and the strong castles become tributary 
to manufactures. There is very remarkable evidence of 
this in the contemporary royal legislation. The first vol- 
ume of the collection of these ordinances, for the third 



164 HISTORY OF POLITICAL ECONOMY. 

race, embraces more than a hundred, all devoted to ques- 
tions of work and the industrial arts, of monuments, com- 
merce, and exchanges. These ordinances, unquestion- 
ably, leave much to be desired, for they are generally 
drawn up for fiscal and oppressive ends ; but their num- 
ber and variety even, demonstrate the importance already 
attached to the matters which they attempted to deter- 
mine. We shall explain their spirit and the principal 
facts, with a few details, because, taken together, they 
form the first ofificial starting point of economic science 
in Europe. 



CHAPTER XVIII. 

The economic legislation of the first kings of France of the third race. 
— Ordinances regarding the Jews. — Moneys. — Against the export of coin.— 
Trade in grain. — Sumptuary laws. — Official origin of our commercial preju- 
dices. 

There exists, we have said, authentic evidence of the 
prodigious impulse given to the production of wealth, 
through the influence of the crusades and by the trade 
of the Hanse towns, from the twelfth to the fourteenth 
century : it is the collection of the ordinances of the first 
kings of France of the third race. We find among these 
ordinances more than a hundred provisions, all relating to 
industrial and commercial matters, principally upon usury 
and the Jews, coins, workmen, weights and measures, and 
even some attempts at a maximum price and sumptuary 
regulations. The whole political economy of the time is 
revealed in these remarkable documents, the study of 
which appears to us to merit particular attention, because 
they afford a complete summary of the ideas of our an- 
cestors upon several questions which to-day still divide us. 
Certainly, if commerce and the industrial arts had not at 
that time become considerably extended, we should not see 
the contemporary administrations so seriously occupied 
with their affairs that under the single reign of Philippe 
le Bel fifty-six ordinances were issued simply in reference 
'to royal and seignorial coins, and more than ten on the 
Jews and Italian tradesmen. 

An attentive examination of these monuments of the 



l66 HISTORY OF POLITICAL ECONOMY. 

economic legislation of the middle ages, enables us to 
judge with some accuracy of the nature of the influence 
exercised by the government upon questions of finance 
and manufactures, at this interesting epoch. Such a 
study is so much the more curious, as most of our pre- 
sent commercial prejudices have no other origin than the 
exclusive and intolerant legislation of the thirteenth cen- 
tury. Thus our laws upon usury, so deeply at variance 
with experience, good sense, and the general interest of 
lenders and borrowers, are only a relic of the ordinances 
issued against loaning at interest, and especially of those 
against the Jews under Louis IX. and his successors. Our 
bad custom-house laws, so exclusive, so hostile to foreign- 
ers, are the fruit of the narrow habits of nationality and 
egoism general at a period when national unity needed 
them to become consolidated rather than enriched. The 
intervention of the government in the purchase and sale of 
goods, and the attempts at maximum prices, renewed un- 
der the terror of 1793, date from the day when Philippe le 
Bel * thought it his duty to fix the price of wheat and 
oblige the traders to keep the markets supplied with it, 
however scarce it might be. All our legislation in grain 
is traceable to the ordinances which forbade its export, 
and the first errors of the system of the balance are found 
in the ordinance of the 28th of July, 1303, which pro- 
hibited the export of gold and silver. Who can say how 
far these continually repeated prescriptions may have 
contributed to strengthen deplorable prejudices in the 
minds of the people ? 

Let us examine rapidly and in chronological order the 
ordinances issued from the accession of Philippe-Auguste 
to tho' time of Charles le Bel, i.e., for a period of about 
two centuries. Of all the kings who occupied the throne 
during these two hundred years, there was not one but 
thought he must manifest his power or his orthodoxy by 
severe measures against the Jews. We constantly come 

* Ordinance of March, 1304, in the Louvre Collection, vol, i, p. 426. 



JEWS. MONEYS. SUMPTUARY LAWS. 167 

upon ordinances against these pariahs of the middle ages, 
who were considered as preeminently subjects for taxa- 
tion. Philippe-Auguste issued four celebrated ones, the 
first of which threatened them, the second despoiled 
them, the third drove them from the country, and the 
fourth freed their debtors. Louis VIII also proclaimed 
his. He suppressed all interest on money, and caused 
the sums due the Jews to be paid for the benefit of the 
lords. We have already seen that Saint Louis was no 
less severe in regard to them : Philippe le Bel and Louis 
le Hutin continued the system of their predecessors. 

After the Jews come the moneys, and no reign passed 
without the royalauthority issuing more than one ordi- 
nance on this subject. Saint Louis decreed that the coin 
of his government should be substituted everywhere for 
that of the lords ; and that prescription, already at- 
tempted by his predecessors, would have had favorable 
results, if, later, kings had not abused their right by 
artificially multiplying their resources by fraudulent 
alterations of the coin. These alterations were repeated 
with unheard-of perseverance, notwithstanding the bad 
results which followed nearly every one of them. Now, it 
was forbidden those whose income was less than six thou- 
sand francs, to possess gold and silver plate : again, those 
who had any were enjoined to carry a third of it to the 
mint, where the manipulators of the crown bought it at 
the old price, to sell it again at a profit under the form 
of debased coin.* The king was himself obliged to ask 
pardon for this of his own subjects, and he promised to 
indemnify them in the future. f 

* Ordonnance de Philippe le Bel,, in the Louvre Collection, vol. i, page 
324- 

■)• We give an extract from that curious document: " Nosttum facimus 
quod pro ingruentibus nostris negotiis, temporibus istis monetam fabricari 
disponentes, in qua forsan aliquantulum deerit de pondere, alleio, seu lege 
* * * ne propter hoc monetam recipientes eamdem in posterum damnifi- 
cari contingat aut Isedi, praesentium tenore promittimus, quod omnibus qui 
monetam hujusmodi in solutum, vel alias recipient in futurum, in quod de 
ipsius valore, ratione minoris ponderis, alleii, sive legis deerit, in integrum 
de nostro supplebimus, ipsosque indemnes servabimus." Ordonnances des 
Jiois de France, vol i, page 325. 



l68 HISTORY OF POLITICAL ECONOMY. 

The regulations about grain occupy a notable place in 
the collection of ordinances. A war, a famine, a bad 
harvest, was sufficient to bring about a prohibition to 
export provisions, with heavy penalties ; but these prohi- 
bitions almost always resemble reprisals, and they are 
generally accompanied by a corrective. " Considering," 
it is said, " that our enemies might profit by our pro- 
visions, and that it is also important to leave them their 
merchandise, we have ordered that the former shall not 
be exported nor the latter imported." It was therefore 
the thought of war which caused foreign commodities to 
be rejected in 1304, by Philippe le Bel, and in 1793 by 
the National Convention ; and to-day in a time of com- 
plete peace and full civilization, the same system still 
prevails, supported by the same arguments ! 

Sometimes, however, the ordinances were marked by a 
wise and thoughtful solicitude, as when they prescribed 
that statistics be obtained of the supply of grain in the 
cities and provinces, for the purpose of restoring confi- 
dence among the citizens and enlightening the magis- 
trates. The edict of February, 1304, due to Philippe IV, 
shows also, in other matters, remarkable penetration and 
accurate views. " Let persons be sent into all the cities 
and villages of the viscounty of Paris, to ascertain every- 
where how much grain, as wheat, meslin (a mixture of 
wheat and rye, — Trans.), rye, barley, oats and every other 
kind of grain there will be, and how much in each city and 
territory, and how much will be needed to keep them alive 
until the new comes and to furnish grain for sowing ; and 
whatever is in excess shall be brought to the markets 
within that viscounty, not all together, but by degrees, so 
that the grain can last until the next season ; and it must 
not be allowed to be taken out of the said viscounty, 
without especial leave. Any one who wishes can buy the 
grain, if he pays the money at once, but let no one buy 
grain to store in a granary, under penalty of losing it." 

But in spite of these precautions which aimed at the 



ATTEMPT TO REGULATE PRICES BY LAW. 169 

same time to prevent popular alarm and monopolies, this 
very prince was obliged to promulgate, the following 
month,* an ordinance concerning the maximum, in virtue 
of which no one could sell, under penalty of confiscation 
of his property, a setier of the best wheat, Paris measure, 
for more than forty Parisian sols (a coin worth about a 
half-penny.— Trans.), and a setier of grain of an inferior 
quality, proportionately. A setier of the best beans and 
the best barley, Paris measure, was to bring thirty sols ; 
the best oats, twenty sols ; a setier of the best bran, ten 
sols. Whoever had more grain than he needed for pro- 
vision and for seed, must send it to market ; and if, 
after the proclamation was made, any persons were found 
to have more than the necessary quantity, all was con- 
fiscated for the benefit of the king.f Who would then 

* In March, 1304. 

I It may be well to'quote that ordinance here, as also those decreed by the 
National Convention, which proclaimed the maximum. The following is the 
ordinance of Philippe le Bel : 

Philippus Dei gratia, Francorum rex, Ballivo Viromandensi salutem. 
Sicut, in subjectorum nobis populorum tranquillitate et prosperitate ventura 
gloriamur uberius, sic et in ipsorum afflictione et adversitate noxia, et op- 
pressis compatimur, et condolemus afflictis vias exquirentes et modos, juxta 
datum nobis a Deo potentiam, quibus et eorum succuratur indigentiis, dis- 
pendiis obvietur. 

Cum itaque victualium omnium et praecipue bladorum, pisoram, fabarum, 
hordei, avens, coeterorumque granorum, quibus sustentari consuevit populi 
multitudo, adeo in regni nostri partibus Domino permittente caristia invalu- 
erit his diebus, quod humilis plebis copia innumerabilis, nisi eis indilato suc- 
curatur remedio, diutius, absque gravi totius vulgi dispendio, non poterit 
sustentari. 

Generali condolentes excidio, prcesertim cum necessitatis tempore omnia 
fere cotnrtiunia jura publice proterantur, consulte duximusordinandum, quod 
baillivias, vice comitatus, preposituras, et alia loca regni nostri, de quibus 
expedire viderimus, faciemus publice proclamari, ac etiam inhiberi, sub 
omni amissione bonorum, ne quis subditorum nostrorum sextarium frumenti 
melioris, ad mensuram parisiensem, ultra summam quadraginta solidorum 
parisiensium, vendere, vel emere, seu vendi, aut emi facere, quoquomodo 
prsesumat, et sextarium frumenti, seu bladi minoris, pro minori pretio, vendi, 
aut emi descendendo, prsecipimus, habita consideratione ad valorem et pre- 
tium melioris sextarii, aut pisorum meliorum, ad mensuram praedictam 
similiter, pro quadraginta solidis parisiensibus et minora pro minori pretio 
descendendo, vendi praecipimus, ut est dictum. 

Fabas quoque. et hordeum, pro triginta solidis, avenamque pro viginti 
solidis, et furfur pro decern solidis parisiensibus, sextarium, ad mensuram 
parisiensam, de melioribus et de aliis pro minori pretio descendendo, ac 
coetera grana, habito respectu ad meliora, juxta eorum qualitatem, vendi 
volumus, modo quo superius est expressura. 



170 HISTORY OF POLITICAL ECONOMY. 

have supposed, that after that threatening ordinance, the 
famine would increase and the markets be barren ? This 
is what actually happened, because then as to-day every 
similar law must bear its consequences. In vain had 
Philippe IV taken care to add that people could securely 
bring every kind of bread to market, with a royal safe-con- 
duct, without any one having power to stop or to take 
away horses and carts : his infraction of the eternal laws 
of trade was not long in aggravating the evil which it 
aimed to prevent, and he was obliged to revoke the ordi- 
nance concerning the maxiiniim^ almost immediately after 
having issued it. The terms which he employed on that 
occasion are so remarkable that we reproduce them liter- 
ally ; they belong, besides, to the history of science, which 
rarely finds a frankness so explicit in the language of 

kings. 

• 

Vobis itaque prsecipimus, et mandamus quatenus in civitatibus, oppidis, 
bonis villis et aliis locis baillias vestrae, de quibus expedire videritis, ordina- 
tionem, et statutum prsedictum publice et solemniter proclamari, et in quali- 
bet sui parte facialis firmiter observari. Si quern vel quos ipsius trans- 
gressores inveneritis, animadversione in eosdem expressa punientes, nemini 
in hac parte parcendo, nisi de nostra speciali licentia, seu mandate. 

The following is a statement of the reasons for the law on the fnaximum 
presented to the Convention by Coupe, of the Oise, in the name of the com- 
mittee on subsistence : 

" I hasten to present to the National Convention riie result of the dis- 
cussions of your commission on the maximum to be fixed upon for the 
various commodities of prime necessity, except wood and charcoal, which you 
taxed yesterday by a special decree. 

" This law is awaited with the greatest impatience ; and malevolence and 
cupidity, combining their detestable operations with those of our enemies 
from without, do not permit us to defer it. 

" We have felt the number and extent of the difficulties connected with 
it : the law has even seemed to alarm some of our colleagues : only a small 
number of us have remained, and these are sustained less by confidence in 
our strength than by our good intentions. 

" In ordinary times, the prices of things are naturally formed and adjusted 
by the reciprocal interest of buyers and sellers : this scale is infallible. It 
is useless, even under the best government, to interfere with it. However 
enlightened, however well-intentioned, the government may be, it never finds 
so just a scale, and it runs a risk by interfering to produce a change. 

" But, when a general conspiracy of unexampled malevolence, perfidy, 
and rage, combines to break this natural equilibrium, to famish us and rob 
us, the safety of the people becomes the supreme rule. 

" Society has the right to resist that war of commerce and tyrants, and to 
reestablish and secure with a firm hand the balance which should exist be- 
tween our productions and our necessities. 



LAW ESTABLISHING A MAXIMUM REVOKED. 17I 

" Philippe, by the grace of God king of France, to the 
bailiff of Senlis, greeting : Whereas, in order to restrain 
the common tempest and necessity of these days, on ac- 
count of the high price of wheat, peas, beans, barley and 
other kinds of grain by which the mass of the people are 
sustained, we lately ordered and established and caused 
to be proclaimed and forbidden throughout our kingdom 
that any of our subjects, under penalty of losing all 
his property, should venture to sell the best wheat at 
more than forty sols, beans and barley at more than thirty 
sols, oats at more than twenty sols, and bran at more 
than ten ; from which statute and ordinance we hoped 
that the greatest alleviation and comfort would come to 
our people, which has not yet come. However, since, on 
account the new circumstances, it is advisable to change 
our council and ordinances : We, in order that the ne- 
cessities of the people may be more promptly met, have 

" Then, too, intelligent calculation is necessary. We must be satisfied 
with establishing, by a niaximtim, salutary limits, beyond which it will not 
be permitted to pass. It is advisable to leave further action to legitimate 
commerce, and to attend to the relations of interests ; and they are innumer- 
able throughout all the localities which France embraces, and still more in 
all the circumstances of a hundred different wars, and the unprecedented 
conspiracy of all parts of Europe against us. 

" Your commission has seen Vhat an endless task, what an inextricable 
labyrinth it would be to descend into all the details of particular kinds of 
provisions, and the reports of localities, and moreover that the law would be- 
come endless and impracticable. 

" They have, therefore, endeavored to get hold of a general and simple 
principle, which could be applied everywhere at the same time, according to 
the various necessities in buying and selling. 

" For that, they have chosen a basis which represents these needs in their 
natural and spontaneous condition : they have chosen the respective values, 
of provisions as they were in lygo. 

" Then everything was at its rate, according to the relations of producing 
countries to consuming countries, and the apportionment of the differences 
necessary to activity of commerce was found ready made ; there was nothing 
more to do except to add an increase proportioned to the more or less ag- 
gravating circumstances in which we find ourselves." 

Then follows the decree of which the following is the first article : 

" The articles which the National Convention has judged to be of prime 
necessity, and of which it has deemed it best to fix the maximum or the 
highest price, are : Fresh Meat, Salt Meat and Bacon, Butter, Sweet-Oil, 
Beef-Cattle, Salt Fish, Wine, Brandy, Vinegar, Cider, Beer, Fire-wood, 
Charcoal, Mineral-Coal, Candles, Lamp-Oil, Salt, Soda, Soap, Potash, Sugar, 
Honey, White Paper, Leather, Iron, Cast, Lead, Steel, Copper, Hemp, 
Flax, Wools, Stuffs, Linens, Prime Materials for manufactured goodsy 
Wooden Shoes, Shoes, Colza and Rape, Tobacco." 



172 HISTORY OF POLITICAL ECONOMY. 

recalled, (revoked) and do recall the prices we have put 
for the said kinds of grain, and have ordered and estab- 
lished that whoever in our kingdom has any of the above- 
mentioned grain, may sell it in market at such a price as 
he can get for it. And we will and command that peo- 
ple shall be allowed to come to market securely and 
quietly, without fear for their horses or carts." 

Thus an experience of a few weeks had sufficed to de- 
monstrate the inutility of violent means in the matter of 
supply of provisions. The ordinances of Philippe le Bel 
are very instructive in this respect, because they form, as 
it were, a little economic drama, where the play begins, 
progresses, and ends, precisely according to the rules of 
science, that is to say, to the advantage of freedom. It 
is somewhat difficult to comprehend why it was that after 
experiments so decisive, the struggle was repeated under 
several reigns, and even at the end of the eighteenth cen- 
tury, between Galiani and Turgot ; between the adminis- 
trators and the economists. This is not all : Philippe le 
Bel, disabused by these unfortunate attempts at a maxi- 
mum, went farther than we have yet done at Paris, at the 
time when I am writing. A year after the revocation of 
his ordinances and the restoration of free trade in grain, 
he freed the consumers from the monopoly of the bakers, 
and permitted every citizen to supply himself with bread 
in whatever way he pleased. " We ordain and decree 
that each Parisian or person residing at Paris, may make 
bread for the supply of his own house and to sell to his 
neighbors, if he makes sufficient and reasonable loaves 
and pays the customary duties. We ordain and decree 
that every day of the week, any one who wishes, may 
bring bread and grain and every other kind of provisions 
to Paris and sell them safely and peaceably. We likewise 
decree that the community may have any of the provis- 
ions coming to Paris that shall be offered in open market, 
at whatever price the wholesale merchants pay for them." 
Strange to say, nearly five hundred years later, Saint 



LEGISLATION ON PRICES AND COINS. 1 73 

Just was obliged to acknowledge in the National Conven- 
tion in almost the same terms as Philippe le Bel, the in- 
efficiency of the maximum to conjure famine. "The va- 
rious laws that you recently passed in reference to means 
of subsistence would have been good," he said,* " if men 
had not been bad. When you passed the law for a maxi- 
mum, the enemies of the people, richer than they, bought 
above the maximum. The markets ceased to be supplied, 
through the avarice of the sellers: the price of provisions 
had been lowered ; but the provisions were scarce. The 
commissioners of a great number of communes competed 
for the purchase of them, and as uneasiness nourishes and 
propagates itself, each one wished to have store-houses 
and prepared for famine so as to be preserved from it." 
Who can help being struck by the similarity of these ac- 
knowledgments, notwithstanding the five centuries which 
separate them ? But at no epoch has one been able to 
violate the essential laws which govern the production of 
wealth, without feeling almost immediately the fatal ef- 
fects of that violation ; and history is replete with similar 
lessons, which do not, however, prevent the same errors 
from being repeated. 

One finds a striking proof of this in the indefatigable 
persistence of sovereigns in overthrowing, at their capri- 
cious pleasure, the legislation in reference to coins. We 
can scarcely comprehend the patience of the people in 
bearing with those perpetual changes in the official value 
of gold and silver coins, veritable sophistications of which 
commerce was the victim, and which can be considered 
only as evidences of bankruptcy. At one time it pleased 
the king to declare that the small sovereigns {royaux) 
should be current for eleven Paris sols ; again, that there 
should be a return to the good coin of the time of Mon- 
sieur Saint Louis, and that no one should presume to pay 
otherwise ; then the employment of foreign coins was in- 
terdicted ; and finally, that of copper coin. After having 

*The Moniteur oi Oct. 14, 1793. p. 92. 3d column. 



174 HISTORY OF POLITICAL ECONOMY. 

thus made a disturbance in prices, it was necessary to in- 
terfere in contracts, leases and rents ; and finally it 
was ordered that payments be made each year, or each 
half year, in current money.^ No one, from this time 
forward, could count on any regular income, and the king 
himself was obliged, in order to sell his woods which no- 
body wanted, to make the amejide honorable and declare 
that those who bought in the time of good coin should pay 
in good coin, and those who should buy of the same 
wood in time of weak coin should pay in weak. Each or- 
dinance of alteration was followed by a catastrophe which 
it was supposed could be remedied by tyrannical regula- 
tions. This struggle is interesting to study, because it 
demonstrates the danger and inutility of sovereign inter- 
vention in transactions to which government owes simply 
liberty and security. In departing from these funda- 
mental doctrines, the kings of France opened the way 
for commercial crises, and commenced the long and pain- 
ful series of experiments which fill the first epoch of our 
economic history. How many attempts there were to pre- 
vent the export of gold and to cause the precious metals 
to be brought from every direction to the mint, where the 
workmen of the crown transformed them night and day in- 
to debased coin ! Even pilgrims were hardly excepted from 
the severe rule forbidding the exportation of money. It 
seemed as if by retaining it, wealth was being retained ; 
people did not yet comprehend the simplest laws of the cir- 
culation, and they were laying the foundations of that 
worship of gold of which the exclusive system was to be- 
come later the final expression. Some were obliged to 
sell their silver plate, others to have their necklaces and 
rings melted for coinage. There was a belief that wealth 
was multiplied by making of one good coin two bad ones ; 
and when prices rose in view of these assignats of royal 

* " If bargains are made for a sum or quantity to be paid in different years 

{ox Jive thousand livres, for example, or for more or less, to be paid in ten 

' years, every year so many thousand livres, they shall be paid in such money 

as shall be current according to our ordinance, at the time when each payment 

shall fall due." — Ordinances, vol. i, p. 444. 



SUMPTUARY LAWS. 1 75 

fraud, no other corrective was found to that inevitable 
consequence than to proclaim sumptuary laws and im- 
pose limits on consumption. 

" We decree," says an ordinance of 1294, " that every 
manner of people who have not an income of six thou- 
sand Tournish livres shall not use, and will not be able 
to use any gold and silver plate, for drinking, for eat- 
ing, or for any other use, and that no person, under 
penalty of fine and imprisonment, shall practice any fraud 
about it : and from the above mentioned silver, we decree 
that our coin be made for the common profit of our king- 
domy 

Another ordinance of the same year prescribed as fol- 
lows : 

"Mo bourgeois woman shall have a chariot. 
" No bourgeois, man or woman, shall wear green, or 
grey, or ermine, and they shall dispose of those they 
have, by a year from Easter next. They shall not wear, 
nor will they be able to wear, gold, precious stones, or coro- 
nets of gold or silver. 

" The dukes, counts, and barons of six thousand livre:: 
in land, or more, may have four robes a year and no more, 
and the women as many. 

" A knight who has three thousand livres in land, may 
have three robes a year and no more ; and one of these 
three robes will be for summer. 

" No one shall have at the principal meal but two 
viands and a pork soup, and let him not deceive about it, 
and if it is fasting season, he shall only have two herring 
soups and two dishes. 

" It is ordained that no prelate or baron shall have a 
robe for his body of more than twenty-five Tournish sous 
a Paris ell." 

Who would believe that all these injunctions, worthy 
of the worst Utopias of Sparta, and these herring soups ^ 
not less ridiculous than the black broth of the Lacedae- 
monians, belong to a time when an effort was everywhere 
being made to revive manufactures, and when the Hanse 



1/6 HISTORY OF POLITICAL ECONOMY. 

towns and the Italian republics had already risen to a 
very high degree of riches and splendor ! But the sight 
even of that wealth, suffices to explain the blind perse- 
verance of kings in prohibiting the export of gold. 
France had at that time little to offer in exchange for 
the products she needed ; and it was in vain that ancient 
ordinances forbade to trade otherwise than by exchange 
of commodities, since on the one side there was only 
money, and on the other products. It was absolutely nec- 
essary that money should go, and it went, to be swallowed 
up in the coffers of the Italian governments, which we 
shall soon see maintaining armies of mercenaries with the 
gold of the nations tributary to their commerce and 
manufactures. In vain, from time to time, the royal wrath 
lays hold of these intrepid merchants, under the stigma 
of Lombards, usurers, and Caorsins ; general interest has 
rendered them necessary, and they continually reappear, 
eager for the quarry,* sowing in the heart of the people 
the first distrusts, still ineffacable, of the exportation of 
gold.* Such was the true origin of our prejudices in 
political economy, which arose from political resentment, 
as when all commerce with the Flemish f was interdicted ; 
or from religious fanaticism, as when the Jews were per- 
secuted. The prejudices have been perpetuated from age 
to age in the administrations and the spirit of the people, 
and they still bear sway, invested with the supreme sanc- 
tion of governments. This explains why so much diffi- 
culty is to-day experienced in destroying them in spite of 
the refutations and solemn protests of experience and 
history. Such is the power of everything that has been 
strongly organized ; and nothing has been so with more 
talent and ability than the rising industrial arts, whose 
beginning under Saint Louis we are about to study. 

* " And as we have learned that several Italians are in our kingdom, 
who are carrying on trade in merchandise and are making contracts which 
are not honorable, our intention is, not to give to such Italians the above- 
mentioned franchises and liberties." — Ordinance of Louis Hutin, July 9, 
1315- 

f See another ordinance of Louis le Hutin of February 28, 1315, and the 
sixty to eighty ordinances issued against the Jews in less than four reigns. 



CHAPTER XIX. 

Organization of Corporations under the reign of Saint Louis. — The Book of 
Trades, by Etienne Boyleau. — General view of the System of the Corpora- 
tions. — Its past benefits and present disadvantages. 

The reader has been able to judge, from the ordi- 
nances which we have quoted, of the state of anarchy 
which existed in European society at the end of the 
twelfth and in the thirteenth century. There was 
neither rest nor stability except for landed property ; 
it alone had all the enjoyments, all the privileges, all the 
liberties. But already by its side was arising personal 
property, created by the labor of the democracy ; and in 
vain the rank to which it aspired and which it was soon 
to occupy, was refused it in the state. By degrees it 
became emancipated in the cities, which it either bought 
or had adjudged to itself, the bourgeoisie; every day 
saw new edicts declared in its favor, and its power be- 
came consolidated by the very efforts made to ruin it. 
The communes were already emancipated when they 
obtained the concession of their franchises, and the per- 
secutions against the Jews, who were continually pro- 
scribed and always recalled, already proved the impor- 
tance of the possessors of capital. Legislation became 
humane in proportion as the villeins acquired wealth. 
They were protected in the fairs, on the markets : they 
were granted tribunals composed of their peers, and 
were exempted from a multitude of exactions from 
which they had previously suffered. But at the time of 

177 



178 HISTORY OF POLITICAL ECONOMY. 

their emancipation, a remarkable fact occurred, which 
characterizes in a striking manner the feudal spirit of the 
times : it was the hierarchical organization of laborers 
under the system of corporations. It came into the 
mind of no one to free man as man ; the principle of 
equality did not yet exist. There were to be masters 
and apprentices as there were lords and vassals, and a 
soil for agriculture. No one conceived of free labor ; it 
was absolutely necessary that the workman work for a 
master as the peasant for a lord. This was the price of 
freedom ; the king sold it as an article of food, bvit it 
was not without purchasers. And how could it have 
lacked them, in the midst of that industrial army which 
suddenly arose from the darkness of feudalism ! 

It will always be greatly to the honor of Louis IX 
that he was the first who thought of subjecting such an 
army to the yoke of discipline.* It gained thereby in 

* It is now known that the organization of trades was anterior to Saint 
Louis. Here is what M. Levasseur says 6n this subject in his excellent 
History of the Working Classes. (1859, 2 vols., in 8vo, Guillaumin.) " Certain 
corporations doubtless trace back to the Roman colleges, although it is im- 
possible to follow their traces in history from the fifth to the eleventh cen- 
tury. We need not be astonished at the silence of the chroniclers and of the 
archives, on such subjects, at a period of grossness and of ignorance, when 
manufactures were of so little consequence and when events the most impor- 
tant left so few traces. But as soon as the practice of writing became more 
common, the proofs of the ancient existence of some corporations begin to 
appear. The marchands d'eau at Paris, are probably the direct descendants 
of the Parisian nautes. It was always necessary that a company of bargemen 
should transport the provisions and merchandise necessary for the supply of 
Paris. History, after the fall of the Roman empire, had lost trace of them : 
it finds it again under Louis VH, who in 1121, accords them privileges as a 
company already ancient. At the commencement of the twelfth century, it 
was not known how far back originated the corporation of butchers at Paris ; 
a charter of 1134 speaks of 'their ancient chopping-blocks : ' another of 
1 162 recalls ' the antiquity of the customs the butchers have long enjoyed,' 
and orders their reestablishment. 

" If we had charters for industrial organization anterior to the eleventh and 
twelfth centuries, it is probable that we should see figure in them the mar- 
chands d'eau and the butchers, who, being always necessary to the city of 
Paris, were not exposed to perish like so many others, in the wreck of civili- 
zation. The trade bodies which reconstituted themselves, were obliged to 
do it so much the more promptly, as the city, on account of being inhabited 
by artisans, was the more industrial and populous. The trade body preced- 
ed the commune, but we cannot say by how many years, and there must 
have been in that pacific and secret reorganization of labor still more of di- 
versity than in the more noisy reorganization of the communes. The 
eleventh and twelfth centuries appear, nevertheless, to have been the time 



THE WORK OF ETIENNE BOYLEAU. 179 

power and vitality what it appeared to lose in indepen- 
dence, and it is since that epoch that manufactures have 
taken a start which will no more be arrested. We can 
but be struck with admiration at the keen penetration 
with which everything was classed in that curious monu- 
ment of legislation, called " Establishments of the Trades 
of Paris," which has come down to us entire from the 
reign of Saint Louis.* 

It was to Etienne Boyleau that Louis IX intrusted the 
care of putting into execution his grand conception of 
giving to the industrial arts and to commerce protective 
regulations and a discipline capable of securing their pros- 
perity. The " Establishments " exercised too great an 
influence on the development of public wealth and the 
destinies of manufactures, not to occupy a place in the 
history of political economy, and we shall devote to it a 
special examination. A simple quotation from the pre- 
amble will give a general idea of it. 

" Etienne Boyleau, guard of the prevostship of Paris, 
to all the bourgeois and all the residents of Paris, etc., 
greeting : Because we have seen at Paris in our time 
much jocularity and unbridled lust which is becoming 
corrupt, and likewise the nonsense of the young and 

when the artisans began to feel the need of combining and formed their first 
associations. It appears that the statutes of the chandlers of Paris date from 
1061. In the Register of the Trades prepared by order of Etienne Boyleau, 
the artisans often plead the privileges which Philippe-Auguste had given 
or himself confirmed to them, and which consequently, could not be subse- 
quent to the year 1223. In 1160, Louis le Jeune grants to Theci, wife of 
Yves and to her heirs, the grand-mastership of the five trades of cobblers, 
baudroiers (belt-makers ?), sweaters, leather-dressers, and purse-makers. 
Each of these trades must have been previously organized. At Rouen, the 
shoemakers and cobblers constituted a corporation to which king Henry 
I, who died in 1 135, had granted certain rights. 

" The trade bodies, then, existed before the thirteenth, ana even before 
the twelfth century ; but it was not until about 1260, when the communal 
movement to which they had given birth, had in its turn communicated to 
them a new activity, that one sees them established in a complete and regu- 
lar manner." — -Vol. i, p. 193, et seq. 

* Three or four manuscripts of it are in existence. The most ancient 
belongs to the imperial library. The archives of the prefecture of police 
possess a good copy. The Register of Trades by Etienne Boyleau, 
is published in the unedited documents on the History of France, by 
M. Depping, 1837, in 4to. — Note of French editor. 



l80 HISTORY OF POLITICAL ECONOMY. 

ignorant, among the young foreigners and those of the 
city, who neither have nor practice any trade, because 
they had sold to strangers no things of their trade so 
good or so loyal as they should be * * * our inten- 
tion is to include in the first part of this work, so far as 
we shall be able, all the trades of Paris, their regulations, 
the manner of initiation {entrepresures) into each trade, 
and their fees. In the second part, we intend to treat of 
the causeways, tonlieus {swms paid for standing in market), 
conduits, shores, market dues, weights, boating dues, 
machinery, and all other common matters. In the third 
part and in the last, of courts and jurisdiction, for all 
those who have courts and jurisdiction in the city and 
the faubourgs of Paris, This we have done for the profit 
of all, including the poor and the strangers who come to 
Paris to buy commodities, that the commodities may be 
so loyal that they will not be deceived by there being 
some defect ; and to punish those who shall receive dis- 
honest gain or through lack of sense ask it and take it, 
contrary to God, to law and to reason. When this was 
done, collected, brought together and arranged, we had 
it read before a great assembly of the wisest, most loyal, 
and most venerable men of Paris, and those who know 
most about these things, who all praised this work much ; 
and we commanded all the trades of Paris, all the tax- 
collectors and all the commoners that they should not 
act or go contrary to it." 

Thus the king had especially in view the termination 
of the numerous frauds committed to the detriment of 
buyers, and the drawing up special regulations for each 
trade. A few manufacturers remained free ; several 
were bound to the payment of certain duties, and a 
small number could be carried on only by receiving the 
privilege from the sovereign. Such were (who would 
think it ?) the occupation of cobbler and that of huckster 
of onions and garlic* The most minute prescriptions 

* ' ' No one can be cobbler unless he purchases the trade from the king. 

" No one can be a huckster of fruit or of greens, that is, of garlic, onions, 
or eschalots, if he does not buy the trade from the king." — Extracts from 
Book of Trades, 



REGULATIONS FOR TRADE-CORPORATIONS. 



I8l 



obliged the workmen to conform, under penalty of a fine, 
to a great number of observances laid down for them m 
the " Establishments." Spinners were forbidden to mix 
the fibre of hemp with that of flax. The baker, privi- 
leged by the king, could sell salt-water fish, cooked-meat, 
dates, grapes, common pepper, cinnamon and licorice; 
but the cutler had no right to make the handles of his 
knives. The porringer-maker and the makers of troughs 
would not have been allowed to turn a wooden spoon. 
The single business of hat-maker had five different 
trades. In thus establishing division of labor. Saint Louis 
contributed much to the perfection of manufactures, and, 
by guaranteeing to the purchasers honest goods, he en- 
couraged commerce more than his successors did in ten 

reigns. 

The " Book of Trades" contains regulations for more 
than a hundred different occupations, whose number and 
variety suffices to demonstrate the importance that the 
industrial arts had acquire d in the cities.* Most of 

* The following are the names of the principal kinds of business organ- 
ized by Etienne Boyleau, just as designated in his " Book " : Lamp-makers, 
Barrel-Makers, Pewterers, Fullers, Dyers, Shoe-makers Potters, Copper- 
smiths, Hawkers, Guagers of wine. Tavern-keepers Sellers of Cerevisia 
(a beverage,- rr««j.), Hucksters of Salt and of Sea-fish, Huclcsters of fruit 
and of green herbs, Goldsmiths, Rope-makers, Toy-men, Cutler-Smiths. 
Cutlers that make handles. Locksmiths of /a^on, Beaters of iron-wire, 
Makers of iron-buckles. Makers of iron-wire buckles, Drawers out of brass- 
wire, Dress-Cutters, Workers of flax at Paris, Workers of flax outside of 
Paris, Traders in hemp and hemp yarn, CAanevaaers, Pin-makers, 
Carvers of crucifixes and of knife-handles, Painters and Carvers of images, 
Workers in silk fabrics, Makers of thread bracelets, 1 hose who work on 
silk cloth Smelters of ore, Fermaillers de laton. Makers of chaplets shoe- 
buckles and dress buckles. Weavers of silk kerchiefs Carpenters, Masons, 
Makers of cross-belts, Cordwainers, Dealers in sheep-skin or Chaveteniers de 
bazenne, Weavers of knotted carpets, Cobblers, Leather-dressers, Makers 
of leather straps, Dealers in hay. Flower milliners, Cotton-hat makers. Felt- 
hat makers, Weavers of cloth. Herring-dealers, Farriers, Locksmi hs, 
Bakers, Millers of Grandpont, Corn-Chandlers, Measurers of grain, Dealers 
in oil Tallow-chandlers, Sheath-makers, Makers of scabbards for swords. 
Casket-makers, Comb-makers and lanthorn-makers Makers of writing- 
tables. Overs and Cooks, Poulterers, Dicers, (Makers of gaming dice,) Makers 
of sewing thimbles. Button-makers, Barbers, Bath-keepers, Mercers, Old- 
clothes women who sell old linen in the new markets, Drawers out of iron- 
wire. Dealers in fastenings, Inn-keepers, Dealers in chaplets of bone and 
horn Makers of coral chaplets. Makers of amber chaplets, Enamelersof jewel- 
ry Sealers in diamonds. Beaters of gold to thread, Tin-beaters, Beaters of 
gold-leaf, Lasseurs of thread and silk, Girls who spin silk on great spindles. 



1 82 HISTORY OF POLITICAL ECONOMY. 

these rules, which would be unendurable in our day, 
produced a genuine revolution in the arts which they 
aimed to guard and perfect. Soon the numerous frauds 
which dishonored the workshops and paralyzed commer- 
cial speculations were observed to disappear. Even if 
the organization of corporations had rendered only this 
service to labor, the good which resulted from it would 
be immense ; but the workers grew strong by undergoing 
discipline. The esprit de corps, in other times so disas- 
trous, arose among them and gave to their association a 
serious character and a solid existence. These brother- 
hoods, these universities of workmen did not, afterwards 
allow the privileges so dearly bought to be easily wrested 
from them. They put themselves under the protection of 
the saints, adopted sacred banners, standards of their inde^ 
pendence, and persistently avenged the least offence 
done to any of their members. They had their syndics, 
their chambers of discipline, their councils, their defend- 
ers. The honor of the various corporations being thus 
placed in the safe keeping of all those who belonged to 
them, raised the laboring classes to the rank of the social 
powers, such as the clergy, nobility and magistracy. 
Their hierarchy was not less strict than in the high ranks, 
and the lords of the castle were not more respected by 
their vassals than the masters by their apprentices. The 
habits of domination passed very quickly from the cas- 
tles to the workshops ; there was a shop-despotism by 
the side of the tyranny of the manors. 

Saint Louis was far from foreseeing all the consequen- 
ces of his organization of the trades, a work of policy 
quite as much as of political economy. He, in fact, only 
laid the first stone of this grand edifice of corporations, 

Makers of thread and silk fringes, Escuelliers, Weavers of swaddling-bands, 
"Weavers of Saracen tapestry, Dealers in old furniture, Makers of leather 
purses and trusses. Saddlers and painters of saddles, Chapuisezns Painters of 
armorial-bearings, Harness-makers, Conr^eurs de Cordoiies, Couratiers de 
Cordoues, Peacock-feather milliners, Furriers and trimmers of hats. Sur- 
geons, Furbishers, Makers of artillery-bows, Fishers (with a rod), Dealers 
in fresh-water fish, Dealers in salt-water fish. 



RESULTS OF BOYLEAU'S EFFORTS. 1 83 

and we might sum up his system in two lines : " Every 
man shall work at his trade and nothing but his trade, in 
order to do well and cheat nobody." But, as the provost 
Boyleau had carefully provided against all cases of fraud, 
and indicated the best processes of labor, it came to pass 
that the Book of Trades became a treatise on manufac- 
tures, and the model according to which every one di- 
rected his efforts. The Grand Chamberlain of the King 
obtained the supervision of the corporations, and secured 
the royal sanction for all measures which could be of ad- 
vantage to them. Henceforward a lively emulation was 
established between the artisans : assembled in the same 
quarters,* placed under the eyes of each other and before 
consumers free to choose the most worthy and skillful 
among them, they soon acquired qualities which would 
have remained very rare under the preexisting anarchical 
regime. 

It was reserved for the successors of Louis IX to com- 
plete his work and to complicate, while desiring to resolve 
them, the dif^cult questions which soon or late were to 
arise from it. Saint Louis had, in fact, regulated too 
minutely the task of each workman, for there not to arise 
numerous conflicts between the different arts. How 
could discords have been avoided between hat-makers, 
some of whom had the right to make only cotton hats 
and the others only felt hats? Who could answer for 
harmony always reigning between the cutlers who made 
handles and those who made blades? Who does not see 
the difficulty of recognizing, in the making of candles, 
the mixture of old wax with new? The spinners could 
no longer mix hemp and flax ; the cobblers had no right 
in mending shoes to renew more than two-thirds of them, 
under penalty for encroaching upon the prerogative of 
the shoemakers. Master-saddlers out of work were per- 
mitted to make shoes, but shoemakers could not make 
saddles. The joiners had functions carefully distin- 

*Joinville, p. 152. 



1 84 HISTORY OF POLITICAL ECONOMY. 

guished from those of the carpenters. Scarcely, there- 
fore, had these brotherhoods become established, when 
the workers ceased to live as brothers. Powerful against 
attacks from without, the corporations had to maintain 
continually in their own midst a civil war, and their dis- 
cords were not long in delivering them over, bound hand 
and foot, to the arbitrary power of the crown. From 
Saint Louis to Louis XIV, there was not a sovereign 
who did not impose restrictions, taxes and new regula- 
tions upon them: the courts overpowered them with 
judgments and fines without diminishing their ardor or 
calming their hatreds. The founder of trade corporations 
had desired to create order ; his successors only saw in 
them a means of making money. 

An ordinance of Charles VI, in 1407, begins to modify 
the prescriptions of Louis IX relative to the sale of mer- 
chandise. The edict of Henry III, in 1581, imposes a 
heavy tax on corporations, under the form of a royal 
duty, and multiplies the rules concerning apprenticeship, 
the reception of masters and the election of wardens. 
Another edict, by Henry IV, issued in 1597, confirms the 
preceding and adds to it some new provisions more op- 
pressive. At length, Louis XIV, by his edict of March, 
1673, establishes corporations in all the cities and market- 
towns of the kingdom, and creates more than forty super- 
fluous ofifices. Thus mutilated by the hand of ten kings, 
the corporations no longer bear scarcely any resemblance 
to what they were under Louis IX, and there remains 
almost nothing of the high conception which originated 
them. They now present nothing but a vast arena where 
ignoble mercantile combats take place, to the advantage 
of the new feudal power, which exploits, under the name 
of comrades and apprentices, the unfortunates who had 
escaped from the glebe of serfdom. Monopoly invades 
industrial society. The number of trades is strictly 
limited, to secure to some privileged individuals the ad- 
vantages of mastership. Artificial obstacles are placed 



OBSTACLES TO PROMOTION. ABUSES. 1 85 

in the way of the genius who is in advance of his 
age ; and interminable delays prolong, under the name 
of apprenticeship, the childhood of man. This ap- 
prenticeship itself is only a disguised slavery. But 
still it is slavery. During its whole period, the un- 
fortunate apprentice is the property of his master, 
who is invested with the right of making him- work, 
even by beating him. There are redhibitory vices 
for him as for animals. At one time, this period of hard 
trial last's eight years ; at another it terminates at the end 
of seven, and the apprentice rises to the dignity of com- 
rade. He is the freedman of those times, the mulatto of 
those internal colonies. A person who had served at 
Rouen five years of apprenticeship and as many as a jour- 
neyman, could not enter a corporation at Paris or Bor- 
deaux, without becoming again an apprentice, — a require- 
ment as absurd as it would be to oblige an ofificer to be- 
come again a soldier on changing his regiment. 

The long sufferings of the working class under this re- 
gime of monopoly and exploitation have been too much 
forgotten. What rendered them more horrible, was that 
the tyrants came from the work-shops, and seemed the 
more pitiless by reason of their common origin with the 
apprentices. When the hour came for a journeyman to 
pass to a master, he encountered for judges those whose 
interest it was to put him aside as a rival. They asked 
of him a masterpiece to prove his talent, but a master- 
piece executed according to certain rules, so that his ge- 
nius was constrained to stop at the level of their medi- 
ocrity. No one could deviate from the received processes, 
under penalty of a fine ; and this was a time famous for 
fines, which were imposed for the slightest forgetfulness 
as well as for the gravest offences. A cooper was obliged 
to put his mark on his casks, and to pay a fine for a hoop 
badly set. The locksmith was liable to imprisonment for 
his locks, the draper for his cloth, the tanners for their 
leather. The sergeants were continually passing in the 



1 86 HISTORY OF POLITICAL ECONOMY. 

streets armed with a long pole with parchment ribbons, 
scrawled over with decrees against the bakers, the masons, 
the goldsmiths and other artisans. The collectors had 
no other occupation and the crown no better revenue. 
One is astounded at the abuses which were daily com- 
mitted, to the detriment of the laboring classes, when he 
reads with attention the immense quantities of decrees 
issued upon debates originating in the jealousy of cor- 
porations or their differences with the crown. At Paris, 
the expenses of these suits rose, about the middle of the 
seventeenth century, to more than 500,000 francs a year. 
Modest corporations had them which cost 25,000 francs. 
The statutes of all the corporations are still in existence, 
and may be found either in the City Hall Library or in the 
archives of the police; but it is difificult to discover them 
under the confused mass of edicts, decrees and sovereign 
decisions which were daily called forth by the least inci- 
dent. The esprit de corps combined with the demands of 
private interest to prolong their duration, and there are 
examples of fierce rivalries that no one had succeeded in 
harmonizing after a struggle of more than a hundred 
years. 

Thus, Louis IX had intended to establish order, and 
his successors brought about industrial anarchy not- 
withstanding the absolute oppression under which the 
subaltern workmen groaned. Who would believe that 
women were excluded from the corporation of embroid- 
erers? The journeymen could not marry before having 
attained to mastership, and, as we have said, that master- 
ship was for them the land of Canaan, which they were 
permitted to see, but rarely to enter. Besides the execu- 
tion of the accustomed masterpiece and the double de- 
lays of apprenticeship and comradeship, enormous ex- 
penses awaited the daring one who would cross the boun- 
dary : registration, royal fee, reception fee, police fee, 
fee for opening a shop, honorary fees to the dean and 
the wardens, payment of the usher and the clerk of the 



RESULTS OF THE TRADE-CORPORATIONS. 1 8/ 

corporation, gratuities to the masters who were called to 
the ceremony ; nothing was lacking there, and often the 
unhappy journeyman could not pass to the degree of 
master, for want of the capital necessary to throw a sop 
to his judges. How many feelings of despair must 
have agitated the souls of the workmen during this long 
period of oppression ! Everything was interdicted, even 
to the power to dispose of themselves ; as if freedom 
to work was not the most sacred of all rights ! But 
the last expression of the system of corporations has 
been proclaimed only in England, where the law but 
lately punished with death a workman-deserter, even 
when his country had no work to give him. Etienne 
BoylesiU, provost though he was, did not think of that. 

However, in spite of their numerous vicissitudes, the 
corporations organized by Saint Louis with the idea of 
order, discipline and probity, produced results well worthy 
the attention of economists and statesmen. They accus- 
tomed the workmen to patience, accuracy and persever- 
ance ; they gave renewed security to commerce, and also 
a tremendous impetus to this important element of pub- 
lic wealth. From the time consumers were certain of be- 
ing no longer deceived about the quantity or the quality 
of the products, they made more considerable demands, 
and hence procured more extended means of subsistence 
for the laboring classes. There were also some advan- 
tages in that strict hierarchy which considered the master- 
workman as the family head of his workmen, with powers 
almost as extended as those of a father over his children. 
The limit fixed to the number in each trade kept compe- 
tition within bounds doubtless somewhat narrow and con- 
sequently infected with monopoly, but it hindered those 
rash enterprises which too often give to the industrial 
struggles of our time the character of a deadly warfare, 
where the vanquished becomes bankrupt without the 
conqueror making a fortune. In delaying the marriage 
of workmen without capital or position, the rule of the 



l88 HISTORY OF POLITICAL ECONOMY. 

corporations might pass for a blessing, at a time when 
paternity seemed to be only the gift of creating unfor- 
tunates. But who will absolve that feudalism of the 
workshop from all the scourges it brought in its train? 
If it rendered some services in times now remote, how 
many ravages did it not cause in the subsequent centu- 
ries? How many men of genius did it not stifle in the 
cradle ? What fatal habits of servitude did it not keep 
up? The most significant thing that can be said on this 
subject, is that corporations have been modified or un- 
settled at all epochs when civilization has taken a step 
forward, and that they have been re-demanded whenever 
the humanitarian movement has appeared stationary or 
retrograde. Turgot suppressed * them and his fall re- 
calls them : the Revolution and the Empire destroy them 
beyond recovery, and in 1814 a famous petition solicits 
their re-establishment.f 

We are, however, not consistent, when we refuse to the 
founders of this system the tribute of honor which is 
their due. The establishment of corporations, if one ex- 
cepts its fiscal abuses, was in harmony with the political 
constitution of the times in which it originated. There 
were few trades, but there were customs duties between 
the provinces ; few productions and few markets. The 
interior customs duties secured to local manufacturers 
the sale of their articles, and the convents offered bread 
and an asylum to unoccupied workmen. By the celibacy 
of the monks and of the workmen, population was re- 
stricted within limits proportioned to the means of sub- 
sistence in those times. The apprentice earned nothing; 
but, after a few years, his maintenance fell upon his 
master. Competition did not lower the rate of wages, 
and commerce did not experience those sudden and fre- 

*See the edict of Turgot of 1776, and the report of Dallarde to the Con- 
stituent Assembly, session of Feb. 15, 1791. 

f This petition, extremely curious, and drawn up by M. Levacher Du- 
plessis, has been printed in 4to. 



FREE COMPETITION NOT YET SECURED. 1 89 

quent variations in prices which with us disconcert the 
shrewdest speculators. We have emancipated labor, but, 
strange to say, its condition, in many respects, has become 
more hard and more precarious. It, is because we have 
very imperfectly executed the great work of freeing the 
workers : we have proclaimed unlimited freedom of pro- 
duction, but we have denied ourselves the liberty of al- 
lowing our products to flow abroad. Our system of free 
competition is incomplete ; and, since the destruction of 
the work of Saint Louis, we have only attained the power 
of encumbering ourselves : tariff-wars have succeeded 
the contests of the corporations. 



CHAPTER XX. 

The impetus given to political economy by the Italian republics of the 
middle ages. — Increasing influence of labor. — Increase of personal prop- 
erty. — Resulting changes in the social condition of Europe. — Foundation of 
credit. — Bank of Venice. — Origin of the modern prohibitory system. 

Whoever attentively studies the history of the last 
days of feudalism, cannot fail to be struck with the efforts 
made in different parts of Europe to secure to all pro- 
ducers a juster proportion in the distribution of the 
profits of labor. The affranchisement of the Communes 
in France, the establishment of the Hanseatic League in 
Germany, the creation of the Italian republics, in the 
middle ages, are only episodes in this great work of eman- 
cipation which is pursued from age to age with steady 
perseverance. The organization of corporations, in the 
reign of Saint Louis, in its turn powerfully contributes to 
it. Wherever artisans and tradesmen combine, they en- 
deavor to create an existence independent of the caprice 
of lords and governments. The ease with which they 
conceal their wealth or remove it when the storm gathers, 
their tendency to collect together, and the need there is 
of their services, secure to them franchises which were 
nowhere more extended than in Italy, where they were 
even given the monopoly of sovereignty. 

In the year 1282, the industrial arts were so powerful 
at Florence, that the citizens of that republic elected a 
magistracy composed exclusively of merchants, under the 
name of Priors of the Arts. These delegates of the 
people, united in a supreme college of six members, were 

190 



IMPORTANCE OF THE INDUSTRIES IN ITALY. I9I 

invested with the executive power and lodged in the pal- 
ace of the nation. Their functions only lasted two months, 
but they could be reelected at the end of two years. The 
priors were chosen by their predecessors and the heads 
of the major arts, and a certain number of notables. 
At Sienna, the citizens did the same, and the fifteen 
lords who governed that little republic were replaced by 
nine bourgeois, exclusively selected from the tradesmen. 
At Genoa and at Venice, commercial fortunes took the 
place of the landed aristocracy and created a power more 
absolute than that of the feudal barons. In most of these 
republics, it was necessary to work at some art or trade, 
in order to remain a citizen or to be able to aspire to the 
eovernment of the state. The merchants considered 
themselves ennobled by their business itself ; there was a 
silk nobility and a wool nobility, and the latter soon 
thought they had a right to look down upon the former.* 
At the commencement of the fourteenth century, we ob- 
serve in all Italy infinite shades of diversity among the 
various republican constitutions ; but they all agree in 
this, that nowhere did the aristocracy prevail over the 
industrial and commercial bourgeois. Soon, fire-arms and 
printing, by bringing physical forces and human intel- 
lects more nearly to a level, gave a last blow to the power 
of the castles. 

What man of the people must not have felt his heart 
beat with hope at the sight of the daily increasing pro- 
gress of Italian liberty ! Never had the republics of 
Rome and of Athens enjoyed a freedom like that. At 
Rome and at Athens the contest was for the sovereignty 
of a few ; in the Italy of the middle ages, the indepen- 
dence of all was defended. The magistrates were taken 
from the counting-houses, from the way-side shops : the 
nobles were kept at 3 respectful distance. Every one 
worked for himself, not for masters. There were few vexa- 
tions and few imposts, absolute freedom of trade and 

* Daru, Histoire de Venice, vol. i, p. 505. 



192 HISTORY OF POLITICAL ECONOMY. 

vigorous organization of the industrial arts. The custom 
of having public and private assemblies soon gave rise to 
orators and statesmen ; and experience in mercantile af- 
fairs gave an impetus to the first financial ideas which 
became popular in Europe. We need not suppose that 
these governments of merchants were exclusively occu- 
pied with commerce : * their policy was often more liberal 
than that of the lords whose place they had taken. They 
accorded to the fine arts every species of encouragement, 
and multiplied with most praiseworthy solicitude institu- 
tions of benevolence, instruction, and public utility. 
Thirty hospitals with a thousand beds for the sick and 
the poor; more than two hundred schools where ten 
thousand children were learning to read ; and splendid re- 
wards lavished on the genius of painters, architects, and 
sculptors, all testify to the enlightened zeal of the admin- 
istrators of Florence in the fourteenth century. 

Their commercial prosperity was not less worthy of 
remark. There were estimated to be two hundred manu- 
facturers of woolen goods, producing every year about 
eighty thousand pieces of cloth, the sale of which secured 
wages to more than thirty thousand workmen. Eighty 
counting-houses were devoted to banking business, and 
their numerous branch establishments everywhere favored 
discount and credit, already familiar to the inhabitants of 
that country, before the rest of Europe had become ac- 
quainted with them. Florence then equalled in wealth 
and productive power the republic of Venice, which sur- 
passed most of the other states. Its public revenues 
amounted to three hundred thousand florins. Villani 
compiled quite a complete list of them at that time,t 
which is followed by the budget of expenses, a financial 

* Sismondi, Histoire des Ripubliques Italiennes du Moyen Age. Vol. iv, 
p. 166. 

f This important document has been quoted by M. de Sismondi, in his 
excellent history of the Italian republics. I reproduce it entire, as the only 
complete budget of these times which has been preserved for political econ- 
omy. 



REVENUES OF THE CITY OF FLORENCE. I93 

monument quite worthy of meditation, when one consid- 
ers the little progress the most renowned nations had 
then made in the art of finance. One is surprised to see 
in it that the republic accorded no salary to its public 
functionaries, unless they were foreigners. The militia 
took the place of the army during peace, and the merce- 
naries in the pay of the state figured only among the ex- 
traordinary expenses of war. The indirect taxes far ex- 
ceeded in number and value the direct ones, especially 

Revenues of the city and republic of Florence, from 1336 to 1338, in gold 
florins of the weight of 72 grammes at 24 carats. 

FLORINS. 

Port duties, or import and export duties on mercliandise and pro- 
visions, farmed out by tlie year at ..... 90,200 

Import on tlie sale of wine at retail, \ of the value. . . . 59,300 

Estimo, or land tax on the country places. . . . . .30,100 

Tax on salt sold at 40 sols a bushel to the bourgeois, and 20 sols to 

the peasant. ......... 14,450 

Revenue from the property of rebels, exiled and condemned. . 7,000 

Tax on lenders and usurers. ....... 3,000 

Dues from nobles invested with territorial possessions. . . 2,000 

Tax from contracts (inscriptions like mortgages). , . . 11,000 

Tax on butcheries for the city. ....... 15,000 

" " " country . 4,400 

Tax for rents. .......... 4,050 

Tax on flour and mills. ........ 4,250 

Imposts on citizens appointed podestats in a foreign country. . 3,500 

Tax on indictments. ........ 1,400 

Profit on the coinage of gold pieces. ...... 2,300 

" copper pieces. . . . , . 1,500 

Rent of lands of the corporation, and tolls. ..... 1,600 

Tax on cattle-dealers in the city. . . . . . . 2 150 

Tax on the verification of weights and measures. .... 600 

Street sweepings and rents of the deposits of Orto San-Michele. 750 

Tax on country rents. ......... 550 

" tradesmen. ....... 2,000 

Fines and sentences from which payment is obtained. . . 20,000 

Defaults of soldiers (for exemption from military duty). . . 7,000 

Tax on doors and houses in Florence. ..... 5,550 

Tax on fruit-women and old-clothes women. .... 450 

Permission to carry arms, at 20 sols per head. .... 1,300 

Tax on sergeants. ......... 100 

Tax on woods floated on the Arno. ...... 100 

Tax on the examiners of guarantees given to the corporation. . 200 

Share of the state in duties collected by the art-consuls. ._ . 300 

Tax on citizens who reside in the country. . . . " . . 1,000 

Tax on possessions in the country 

Tax on battles without weapons. 

Tax of Firenzuola. ......... 

Tax on mills and fishing. . ' 

The total exceeds fl 300,000 



194 



HISTORY OF POLITICAL ECONOMY. 



upon the land contribution, which was twice smaller than 
the single revenue from drinks. The amount of the fines 
and convictions plays a great part in the budget of re- 
ceipts, a sad evidence either of little respect paid the 
laws, or of severity in their execution. What else were 
the profits on the minting of gold and copper coin, than 
a concession of the same kind as the alterations in money, 
of which our history is full, from the time of Philippe Au- 
guste to Charles le Bel? Nevertheless, the account of 
the expenses and revenues of Florence testify strongly to 
the simplicity of the governmental regime of the republic; 
happy would it have been, if the rivalry of the new 

in Flotentine 



Expenses of the Republic of Florence, from 1336 to 1338 
livres, a, gold /lot in at 3 livres and 2 sols. 

Salary of the podestat and his family (his archers and sbires**J 
" captain of the people and his family, 

" executor of the orders of courts 

" guardian, with fifty horses and 100 foot soldiers 

extraordinary office soon abolished). .... 

Judge of appeals on the rights of the corporation. 

Officer charged with repressing the luxury of the women. . 

Officer of the market of Orto San-Michele. 

Office of paying troops. ....... 

Office for payments to invalid soldiers. 

Treasurers of the corporation, their officers and notaries. 

Offices of the land revenues of the corporation. 

Jailors and guards of prisons. ...... 

Table of the priors and their family at the palace. 

Wages of the donzels^^ of the corporation and of the guardians 

towers of the podestat and of the priors. 



Sixty archers and their captains in the service of 

Notary of reforms, with his assistant. 

Lions, torches, liglit and fire at the palace. 

Notary at the palace of the priors. 

Wages of the archers and tipstaff. 

Trumpets of the corporation. 

Alms to monks and to hospitals. . 

Six hundred night-guards in the city. 

Flags for festivals and horse races. 

Spies and messengers of the commune. 

Ambassadors. ..... 

Castellans and guards of fortresses. 
Annual provision of arms and arrows. 



he priors. 



of 



the 



15,240 

5,880 
4,900 

26,400 

1,100 

1,000 

1,300 

1,000 

250 

1,400 

200 

800 

3,600 

550 

5.700 

450 

2,400 

100 

1,500 

1,000 

2,000 

10,800 

310 

1,200 

15,500 

12,400 

4,650 



Florins 39,119 at 3 liv., 2 s. per florin=liv. . 121,630 

Labors on the walls, bridges and churches form the extraordinary expenses^ 
with the pay of military men. In time of peace, the republic kept in its pay 
seven-hundred to a thousand dragoons and as many foot-soldiers. 



IMPORTANCE OF THE ITALIAN REPUBLICS. I95 

nobility and too often the oppression of the people by 
patricians originating from themselves, had not opened 
the way to civil discords and exposed the frontiers to 
foreigners! The Italian republics of the middle ages 
may be considered as great commercial houses, adminis- 
tered with ability and economy. The revenues created 
by labor were rarely touched by taxation there, and they 
daily gave rise to new capital, which the freedom of trans- 
actions allowed to be advantageously increased. The 
city of Hamburg and that of Geneva, so rich notwith- 
standing the scantiness of their territory, to-day give us a 
pretty accurate idea of the prosperity of those great 
municipal cities of the middle ages. Their environs, 
covered with country-houses and delightful villas, where 
opulence reposes from the fatigues of commerce, are a 
faithful representation of the sumptuous abodes of the 
Italian merchants, who were then almost all lodged in 
palaces of which their present successors cannot even 
maintain the accessories. They had also become the 
lenders of funds to the principal powers of Europe : they 
were in request as intendants of domains and adminis- 
trators of finances. It was to them that sovereigns in 
distress always applied : it was their gold florins that the 
kings of France took especial delight in altering, and of 
which they changed the value from ten sols to thirty. 
Edward III of England had chosen his two bankers at 
Florence, and the loans he made through them so far ex- 
ceeded his repayments, that the Bardis found that they 
had advanced to him one hundred and eighty thousand 
marks sterling, and the Peruzzis one hundred and thirty- 
five thousand, together amounting to sixteen millions 
three hundred and eighty thousand of our francs, at a 
time when money was five or six times dearer than in our 
day.* The citizens of the Italian republics controlled at 
that time the best part of European commerce. Their 
workmen were eagerly sought everywhere as the most 

* Sismondi, Hist, of Ital. Repub., vol. v, p. 261. 



196 HISTORY OF POLITICAL ECONOMY. 

skilful, and their products as the most perfect. They had 
become arbiters in matters of taste and the sole merchants 
renowned for tissues, fashions, arms and furniture. Their 
capital procured for them also immense profits, not to 
mention their gains as ship-chandlers, as bankers, and as 
partners in all enterprises of any importance. The laws 
which they made in their capacity of legislators invested 
with supreme power, favored in the most liberal manner 
all commercial transactions ; and they were the first to 
prove, in theory and in practice, the advantages, still only 
partially understood, of the most unlimited freedom of 
trade. Genoa and Venice had no other element of great- 
ness. 

We must here take note of the important part which 
the Italians took in the foundation of the first credit in- 
stitutions. Their immense trade had early made them 
feel the necessity of simplifying the contrivances of every 
kind of which that branch of production is composed ; 
and at the end of the twelfth century, Venice had seen 
arise in its midst a bank of deposit which opened credit- 
accounts with money-lenders, to facilitate payments and 
transfers of indebtedness. The bank retained no duty 
for safe-keeping nor for commission, and paid no interest ; 
but its certificates of deposit performed the same func- 
tions as money. By means of a fund {It. cassa), called 
cash, they paid at sight in specie the bills that were pre- 
sented ; and they chose for these payments the best 
money, which became that of the bank. It was ruled 
that the bank should only pay and reckon in good 
ducats, whose standard was finer and alteration less com- 
mon than that of other specie. From this time, the pa- 
per of the bank had the advantage over all bills of the 
merchants, of being exchangeable for standard money, 
and the credit of the establishment was placed on a solid 
foundation. By degrees, the government introduced the 
custom of making its payments in orders on the bank, 
instead of in specie, and it thus added a new element of 



VENICE — HER COMMERCE AND PRIVILEGES. I97 

success to those the bank already possessed. Finally, 
the opening of a debt and credit account, which per- 
mitted the owners of funds to transfer their credits, com- 
pleted the working facilities of the bank, and soon gave 
rise to several similar institutions.* 

The position of Venice made the perfecting of the in- 
dustrial arts and of commerce a necessity to her from the 
very beginning. Venice was a republic without territory, 
and her capital a fleet of vessels at anchor. From com- 
merce she was obliged to seek not fortune, but life itself. 
Therefore, the whole policy of the government had for its 
constant aim the increase of her commercial liberties and 
her financial franchises among all nations. For lack of 
more valuable products, the Venetians began by selling 
salt ; then they exported the agricultural products of the 
north of Italy, and went to the Black Sea for those of 
Turkey, Russia, and Persia. At the fair of Pavia, as 
early as the time of Charlemagne, they had dazzled pur- 
chasers by magnificent exhibitions of valuable carpets, 
silk goods, gold tissues, pearls and precious stones. 
Sumptuary laws obliged them to economize their capi- 
tal and to sacrifice to unproductive consumption only a 
part of their revenues. Placed between the East and the 
West, they had imitated the industry of a part of their 
neighbors and the economic simplicity of the others. 
Their privileges at Constantinople had somewhat of the 
insolence of conquest, and their colonies in the Mediter- 
ranean would to-day almost form a kingdom. Venice 
maintained her consuls, and, in general, all her commercial 
employes,in truly royal luxury. She required them to have 
a numerous retinue in a state to worthily represent the re- 
public and to appear imposing to strangers. The podes- 
tat of Constantinople was for some time on the footing 
of a sovereign. He judged, in final appeal, the differen- 

* M. Dam published, in the 7th volume of his Histoire de Venise, in the 
proofs and illustrations, sect. 2, paragraph 5, a memoir on the Bank of Ven- 
ice, under date of June 30, 1753, extracted from the correspondence of the 
Abbe of Bernis, then embassador from France. 



198 HISTORY OF POLITICAL ECONOMY. 

ces between natives of Venice ; he wore scarlet buskins, 
a mark of imperial dignity, and always appeared in pub- 
lic surrounded with guards. It was by thus honoring the 
commercial profession and favoring in all ways the citi- 
zens who devoted themselves to it, that the Venetians so 
much increased the preponderance of their country and 
the consideration for the merchants who were making 
its fortune. 

The republic also employed, in the fifteenth century, 
in the single dock-yard of Venice, six thousand workmen 
and thirty-six thousand marines. The government sent 
every year to the principal ports squadrons of four to six 
large galleys, which received the merchandise destined for 
private individuals. The object of this was to keep the 
navy in practice and also to make it useful in time of 
peace, to make the national flag respected, and to provide 
means of transport for those who were not in a condition 
to arm vessels on their own account."* The commercial 
marine maintained not less than three thousand vessels 
employed in the importation and exportation of the pro- 
ducts of all the countries in the world. These ships 
explored in turn the ports of the Black Sea, those of Sy- 
ria and Egypt, and they went from harbor to harbor to 
visit all the places of the Peloponnesus, of Asia Minor, 
Cyprus, Candia, and the Greek Archipelago. One fleet, 
the most important of all, set out every year for the 
coasts of Flanders, coasting along Sicily, Africa, and 
Spain, with great vessels which could not have had crews 
of less than two hundred men, and which trafilicked in 
succession on all the coasts in such merchandise as the in- 
habitants needed. Commercial treaties secured the most 
advantageous intercourse in every port to the Venetian 
merchants, who had correspondents at Bruges, Antwerp, 
and London, with the merchants of the Hanse towns. 
Venice had at that time already given a great impetus to 
her manufactures, and the richest packages of her expe- 

* Sandi, Storia Civile di Venezia, lib. v. 



CAUSE OF DECLINE OF. VENICE. 199 

ditions were composed of mirrors, crystal-glass, cloths of 
fine wool, and elegant silk goods, made by Venetian work- 
men. The most enlightened governments of our time 
have never shown as much solicitude as did that republic 
for the interests of commerce and the industrial arts. 

Some authors* have thought they saw in these long 
voyages made in the interests of commerce on vessels 
belonging to the state, the model of the companies which 
the Dutch, English and French subsequently organized 
for trade with the Indies : we cannot coincide in that 
opinion. Without doubt, the private citizens who rented 
the vessels from the government, for their own trade, 
enjoyed some privileges; but these privileges were not 
permanent, and every galley was separately rented at a 
price so moderate, that one cannot reasonably attribute 
to mercenary motives the system followed in that regard. 
Commerce was for a long time free at Venice ; and the 
republic only began to decline when its government had 
caused the source of its prosperity to be exhausted by 
monopoly. At first all the young patricians were sub- 
jected to the most severe ordeals of a commercial train- 
ing. They were often sent as novices on board state- 
vessels to try fortune with a light venture, so much did 
it enter into the views of the administration to direct all 
citizens toward industrial occupations ! The only re- 
proach that can be brought against the Venetians, is the 
effort to exclude foreigners from all competition with 
them. Although commercial jealousy had not yet 
erected prohibitions into a system, and the ports of 
the republic were open to all the merchandise of the 
world, yet the Venetians only permitted its transporta- 
tion in their own ships ; and they reigned as absolute 
masters over all the Mediterranean. War had given 
them security from the Pisans, the Sicilians and the 
Genoese. Spain, long occupied by the Moors, gave them 
little occasion of offence. France disdained commerce ; 

* Among others, Count Daru, Histoire de Venise, vol. iii, page 107. 



200 HISTORY OF POLITICAL ECONOMY. 

England had not yet begun to think of it ; the republic 
of Holland was not in existence. Under cover of the 
right of sovereignty on the gulf, which she had arrogated 
to herself, Venice reserved the almost exclusive right to 
navigate. Armed flotillas guarded the mouths of all her 
rivers, and allowed no barque to enter or depart without 
being rigorously examined. But what profited that 
jealous solicitude for the interests of her navigation ? 
A day came when the Portuguese discovered the Cape 
of Good Hope, and all that structure of precautions and 
mistrust suddenly fell to pieces. 

Here begin the first wars of customs-duties, and political 
economy receives from history valuable instruction. The 
Venetians had levelled all obstacles, but for themselves 
alone, and to the exclusion of other nations. Their legis- 
lation was very strict in respect to foreigners, in the 
matter of commerce. The laws forbade a merchant who 
was not a subject of the republic to be even received on 
board a vessel of the state. Foreigners paid customs- 
duties twice as high as natives. They could neither build 
nor buy vessels in Venetian ports. The ships, the cap- 
tains, the owners, must all be Venetian. Every alliance 
between natives^* and strangers was interdicted ; there 
was no protection, no privileges and no benefits save for 
Venetians : the latter, however, all had the same rights.* 
In Venice itself, and there alone, was it permitted to 
negotiate with the Germans, Bohemians and Hungarians. 
As national manufactures acquired importance, the gov- 
ernment departed from the liberal policy it had hitherto 
pursued, and the manufacturers obtained an absolute 
prohibition of such foreign merchandise as they produced. 
In vain, in the seventeenth century, did declining com- 
merce urge the reestablishment of former liberties and 
the freedom of the port : the attempt was made for a 
brief moment, but the spirit of restriction won the day, 
and the prohibitory regime early prepared the way for 
the death of the republic. 
* Sandi, liv. vi, chap. i. 



PROHIBITION PROVES FATAL TO VENICE. 20I 

The people of Italy, however, pardoned the Venetians 
for their commercial intolerance, because of the moderate 
price at which they delivered all commodities. The Jews, 
Armenians, Greeks, and Germans flocked to Venice and 
engaged with safety in speculations, which were always 
advantageous, because of the security which the credit 
institutions gave and the recognized probity of the mer- 
chants. But soon Venice saw numerous manufactures 
spring up in Europe rivaling her own, and her commerce 
encountered most formidable competition in that of the 
Portuguese, Dutch, Spanish ^nd English. The discovery 
of the Cape of Good Hope took away from her the mo- 
nopoly of the spices of the Indies. The taking of Con- 
stantinople, by Mahomet II, had already deprived her 
of the magnificent privileges which her subjects enjoyed 
in that rich capital of the Orient. But the discovery of 
America and the vigorous reprisals of Charles V, who, 
at the commencement of his reign, in 15 17, doubled the 
customs-duties which the Venetians paid in his states, 
completed the ruin of that fortunate monopoly which had 
made all Europe tributary. Charles V raised the import 
and export duties on all Venetian merchandise to twenty 
per cent ; and this tariff, which would to-day appear 
moderate, sufficed then to prevent the Venetians from 
entering Spanish ports. Such was the origin of the 
exclusive system, the fatal invention which the repub- 
lic of Venice was so cruelly to expiate. So long as 
she sought fortune only in the free competition of the 
talent and capital of her own citizens, she increased from 
age to age and became for a moment the arbiter of 
Europe ; but as soon as she wished to rule the markets 
by the tyranny of monopoly, she saw a league formed 
against her commerce, formidable for a very different 
reason from that of Cambray. 

We could wish no other argument in favor of free trade 
than the prodigious development of Venetian industries 
during the long reign of that freedom. It had not been 



202 HISTORY OF POLITICAL ECONOMY. 

necessary to have recourse to protection to secure to the 
republic, in its finest days, skilful architects, ship-builders, 
and civil engineers who would meet all the demands of 
her service. Her goldsmiths passed for the most re- 
nowned in all Europe. She had manufactures of silks 
unrivaled even in Italy, where that branch of industry 
early made rapid progress ; and these manufactures 
brought her, from the first, more than five hundred thou- 
sand ducats a year, being nearly three millions in our 
francs. The most ingenious workmen from abroad 
received encouragement of every kind to establish them- 
selves at Venice, and the state inquisition pursued with 
its homicidal threats the native workmen who were so 
bold as to expatriate themselves. " If any workman or 
artist," it was said,* " transports his art to a foreign 
country, to the detriment of the republic, an order to re- 
turn will be sent him. If he does not obey, his nearest 
connections will be put in prison, in order to force him 
to obedience by the regard he bears them. If he re- 
turns, the past will be forgiven, and an establishment at 
Venice will be obtained for him ; if, notwithstanding the 
imprisonment of his relatives, he persists in his determina- 
tion to remain in a foreign country, some emissary will be 
charged to kill him, and after his death, his relatives will 
be set at liberty." The inevitable result of these atrocious 
provisions was to retard the development of the indus- 
trial arts, by preventing workmen from going to foreign 
countries to study the secrets and the improvements 
which the arts needed. By making a mystery of their 
already old inventions, they accustomed their artisans to 
them, and shut the workmen up, so to speak, within a 
narrow circle. Everything around them was progressing, 
while they were remaining stationary, and the products 
of their manufactures kept somewhat of a market within 
the republic only by favor of the prohibitory laws. The 
decline began with protection. 

* Art. 26 of Statutes of State Inquisition, 



VARIOUS INDUSTRIES OF VENICE. CREDIT. 203 

Venice had, however, commenced her industrial career 
under the most favorable auspices. A tribunal had been 
created there, as early as 1172, for the regulation of the 
arts and trades. The quality and the quantity of ma- 
terials were strictly examined. Every workman was for- 
bidden to perform more than one kind of work, in order 
to execute it with more care. Manufactures, by the end 
of the fourteenth century, had therefore attained a very 
high degree of perfection. The making of cotton cloths 
was known at Venice about that time. The finest linerts. 
in all Italy were made there, and it was known how to 
print colors renowned for their brilliancy and solidity. 
Berthollet reports* that it was at Venice, in 1429, that 
the first published account of the processes employed in 
dyeing, appeared. Chemistry was then more advanced 
there than in any other country, and the Venetians were 
in almost exclusive possession of the trade in drugs. 
They prepared and gilded leather in a manner recognized 
as superior to that of any other people. Their laces, 
known under the name of point de Venise^ were eagerly 
sought after. Their hardware and their sugar refineries 
scarcely sufficed for the needs of European consumption ; 
and, when painting was still in its infancy among their 
rivals, with them it had risen to the first rank among 
industrial arts. They had established numerous manufac- 
tures, which have since been surpassed in France and in 
the rest of Europe ; but to them belongs the honor of 
having served as a model to all the others. The Vene- 
tians, therefore, were distinguished not only in com- 
merce, but also in the industrial arts ; they for a long 
time united to the advantages of transportation, the 
profits of manufacture. The prudent and ingenious use 
which they had made of the contrivances of credit, had 
by degrees extended throughout the Italian republics, 
and had developed manufacturing and commercial wealth 
in them upon a vast scale. 

* Elements de Part de teinture. 



204 HISTORY 0¥ POLITICAL ECONOMY. 

There is in existence a remarkable discourse, delivered 
in 142 1 at the Grand Council, by the doge Thomas Mon- 
cenigo, upon the financial resources and the extent of com- 
merce of the republic of Venice.* After an exact and de- 
tailed exposition of the profits of national labor in foreign 
markets, and of the part of it which reverted to the state 
treasury, the old doge dwelt principally on the danger 
there would be in disturbing that magnificent prosperity, 
in order to ward off a war then eagerly demanded by the 
restless spirits of the period. " You are the only ones," 
he said, " to whom land and sea are equally open. You 
are the channel of all the wealth ; you provide for the 
entire world. The whole universe is interested in your 

* This discourse is literally quoted by M. Daru in his Histoire de Venise, 
vol. ii, pp. 293-314. The following extract seems to me worthy of figuring 
beside the budget of the city of Florence : 

" I have prepared," says the doge Moncenigo, " a statement of the pro- 
ducts of our commerce : 

DUCATS. 

" Every week there comes to us from Milan seventeen or eighteen 

thousand ducats, which makes per year . . . 900,000 

From Monza, a thousand per week, and per year . . 52,000 

" Como, two " " " . . . 104,000 

" Alessandria, one " << .< ^ ^ 52,000 

" Tortona and Novara, two thousand per week, and per year . 104,000 

" Pavia, two thousand per week, and per year . . 104,000 

" Cremona, two thousand per week, and per year . . 104,000 

" Bergamo, fifteen hundred " " . . 78,000 

" Palermo, two thousand " " , , 104,000 

" Piacenza, one " " " . . 52,000 



1,654,000 

" What evidently establishes the truth of this result is the acknowledg- 
ment of all the bankers, who declare that every year the Milanese has to 
pay us sixteen hundred thousand ducats. Do you find this a pretty fine 
garden which Venice is enjoying without its occasioning her any expense ? 

DUCATS. 
" Tortona and Novara use per year six thousand pieces of cloth 

which, at fifteen ducats a piece, make .... 90,000 

Pavia, 3,000 pieces ...... 45,000 

Milan, 4,000 " of fine cloth, at 30 ducats . . . 120,000 

Como, 12.000 " at 15 ducats .... 180,000 

Monza, 6,000 '<«<»> .... go,ooo 

Brescia, 5,000 <• «< « ^ ^ ^ ^ ^ 75,ooo 

Bergamo, 10,000 " at 7 " . . , , . 70,000 

Cremona, 140,000 pieces of fustian at 4i ducats ... 70,000 

Parma, 4,000 pieces of cloth at 15 ducats t • . 60,000 

000,000 



ADDRESS OF THE DOGE. 



205 



fortune. All the gold of the world comes to you. For- 
tunate, so long as you hold to pacific ideas, while all 
Europe is on fire ! As for me, so long as there remains 
in me a breath of life, I will persist in this, that we 
must love peace. I have always tried to take measures 
that the interest of the loans and all public expenses be 
promptly met every six months, and I have had the good 
fortune to succeed. It only remains for you to maintain 
the happy state of our affairs, praying the AU-Powerful 
to make you persevere in the salutary system thus far 
pursued. If you continue in this course, you will become 
formidable and the possessors of all the wealth of the 
Christian world. Keep yourselves, as from fire, from 

" In all 94,000 pieces ; and the import and export duties, at simply one 
ducat per piece, bring us 200,000 ducats. 

" We have a trade with Lombardy estimated at 28,800,000 ducats. Do 
you think Venice has there a pretty fine garden ? 

" Then come the hemps for the sum of . 
The Lombards buy of you every year 5,000 lbs. of cotton for . 
20,000 quintals of thread (or perhaps of spun cotton), at 1 5 to 20 
ducats per hundred ..... 

2,000,000 lbs. of Catalogne wool, at 60 ducats per thousand . 
As many from France ..... 

Cloths of silk and gold for ..... 

3,000 lots of pepper at loo ducats per lot . 

400 loads of cinnamon at 160 ducats per load . 

200,000 lbs. of ginger at 40 ducats a thousand 

Sugars taxed from 2 to 3 to 15 ducats per hundred 

Other commodities for sewing and embroidery 

4,000 thousands of dye woods at 30 ducats a thousand 

Grains and plants for tinctures .... 

Soaps ......> 

Sla7)es ....... 



DUCATS. 
100,000 
250,000 

30,000 
120,000 
120,000 
250,000 
300,000 

64,000 
8,000 

95,000 

30,000 
120,000 

50,000 
250,000 

30,000 

1,817,000 

" I do not count the product of the sale of salt.* Acknowledge that such 
a commerce is a fine estate. Consider how many vessels the movement of 
all this merchandise keeps employed, either in carrying it to Lombardy or 
going for it to Syria, Romania, Catalogne, Flanders, Cyprus, Sicily and all 
parts of the world. Venice makes two and a half or three per cent on the 
freight. See how many people live from this movement : brokers, work- 
men, sailors, thousands of families, and finally the merchants, whose profit 
does not amount to less than 600,000 ducats. 

" That is what your garden produces. Have you a mind to destroy it ? 
No, indeed : well, you must defend it against whoever may come to attack 
it." 

* Count Fileasi, in his Researches on the Commerce of Venice^ p. 270, values the 
salt product at a million ducats. 



2o6 HISTORY OF POLITICAL ECQNOMY. 

touching the property of others and making war un- 
justly: God will punish you for it. Then those who had 
ten thousand ducats, will have no more than a thousand ; 
those who had ten houses will be reduced to one, and so on. 
No more property, no more credit, no more reputation. 
From the masters that you were, you zvill find yourselves 
subjects, and of zvhom ? Of military men, of soldiery, oj 
these bands whom you are keeping in pay. Foreigners 
have often rendered homage to your wisdom, by taking 
arbiters from among you : continue then, for your own 
sake and for the happiness of your sons, in the system 
which has procured you so much prosperity." 

One can scarcely fail of being touched by the grandeur 
and the wisdom of this language. People then even at 
that remote time already comprehended that commerce 
was essentially the friend of peace, and that nations were 
jointly and severally responsible for each other in good as 
well as in bad fortune. " What will you sell to the Mil- 
anese," said the doge, " when you shall have ruined 
them ? What will they be able to give you in exchange 
for your products ? And your products, what will be- 
come of them before the exigencies of a war which will 
encroach upon the capital you need to create them ? " 
Simple good sense indicated then to eminent men 
what experience has since put beyond doubt, and what 
theory to-day teaches, supported by the authority of 
facts. 

In the other Italian republics, where the industrial and 
commercial spirit had prevailed over feudal despotism, as 
at Florence and Venice, the prosperity was not less bril- 
liant, nor the progress of every kind less astonishing. 
Every one knows of the wealth accumulated at Genoa 
through the boldness of her navigators and the ability of 
her merchants. Genoa had counting-houses in the Archi- 
pelago and the Black Sea, and her merchants came to 
the ports of the Hanse towns to share the profits with 
Venice. The bank of St. George, which originated in 



BUSINESS ACTIVITY. DEMAND FOR MONEY. 20/ 

1407 from loans contracted to meet the public ^ necessi- 
sities, soon became a rival to that of Venice, and rendered 
the same service as its rival. However, the Genoese f 
did not hold as long as the Venetians to the princi- 
ples of commercial freedom, and their government fur- 
nishes the first example of exclusive privileges granted to 
a company, on payment of subsidies. At Milan, in the 
year 1260, the government was occupied with the recen- 
sion of the lands, and in that capital of the Lombard re- 
publics, it was necessary to put more than a hundred 
mints in operation, to meet the immense demand for 
money, necessitated by the development of business. In 
whatever direction we turn our eyes, we are struck by 
the devouring activity which reigns in all these republics, 
and by the penetration with which each of them adapted 
its institutions to the needs of manufactures and com- 
merce. To them we owe the creation of the first institu- 
tions of public credit, whether it was the invention of 
banks, or the conception of loans. They had already or- 
ganized industry, before Saint Louis had founded corpora- 
tions. The power of their governments seems to have 
had no other mission than to protect the interests of labor; 
and, wUile everywhere else taxes were being levied on 
peasants and villeins, at Venice, Genoa, Florence, Pisa, 
and Milan, these same villeins, enriched by commerce and 
the industrial arts, were disposing, like masters, of the 
sovereignty. 

The Italian republics, then, not only served the cause 
of liberty by reviving the noble rivalries of the old Greek 
republics in independence, but, by placing labor every- 
where in honor, they changed the face of Europe, and 
prepared the way for the advent of the liberal doctrines 
whose triumph we shall one day behold. It was among 
them that the great economic experiments were made, 
from which science was to come forth all armed. These 

* Gilbart, History mid Principles of Banking, p. 10. 

f Count Pecchio, Histoire de /' Economic Politique en Italic, p. 6. 



208 HISTORY OF POLITICAL ECONOMY. 

republics tried, in turn, before the other nations, free 
trade and prohibition. They confronted the first perils 
of credit, and laid the foundations of the modern system 
of loans. While the rest of Europe was covered with don- 
jons and thatched huts, Italy was building marble palaces 
and temples ; she was fitting out thousands of vessels, 
laden with the products of her manufactures. She was 
organizing labor, and calling all the citizens, without 
caste distinction, to honors and fortune, when, on account 
of knowledge or capacity, they were worthy of it. Happy 
if aristocracy had not glided into her midst, by favor of 
wealth, like prohibition following manufactures, and like 
monopoly on the steps of commerce ! How many les- 
sons for us in that immense variety of events! Experi- 
ment there preceded science, and showed the first ex- 
ample of a broad application of the theories of trade 
to the practice of government. Administration was 
there presented under the simple and regular forms of 
an industrial management, where all the resources were 
put to work with order, intelligence and economy. One 
might call these governments vast enterprises, strong in 
assured credit, which dispatched rich cargoes to all ports, 
and which were constantly occupied with supplying, by un- 
wearied production, the wants of an immense consump- 
tion. It was, in fact, in the Italian republics that the 
most ingenious arts and the most advanced financial doc- 
trines of which history makes mention at that time, took 
their rise ; and we cannot say to what degree of splendor 
these states might still have risen, but for the fatal acces- 
sion of Charles V, who changed at once the face of Europe 
and that of political economy. 



CHAPTER XXI. 

The change in the course of political economy brought about by Charles 
V. — The spirit of conquest substituted for the commercial spirit. — Official 
establishment of the restrictive system. — Slave trade. — Financial operations. 
— Convents and pauperism. — Opposition of Protestantism. 

Charles Fifth, a child of Flanders, emperor of Ger- 
many, and monarch of Spain, united in his person, in the 
highest degree, all antipathies to Italy. He came from a 
country where the manufacturers of Venice, Milan, and 
Florence had found formidable competitors ; he was, in 
his character as emperor of Germany, the highest per- 
sonification of the Ghibeline party, so abhorred in Italy; 
and, as king of Spain, he was to become the most injuri- 
ous rival of the Italian bankers, who could oppose no se- 
rious resistance to the fortunate possessor of the mines of 
Mexico and Peru. Hardly had he ascended the throne, 
when he put into the commercial balance, beside the 
weight of the sword, that of the new world and of a great 
part of the old. In politics, in religion, in the industrial 
arts, his power would suffer no rival ; and, from the age 
of twenty years, he was prepared to raise all questions 
and to overturn all kingdoms. 

It is not without reason that historians agree in con- 
sidering the reign of this prince as the point of departure 
of a new social order in Europe. Dating from his reign, 
in fact, a rapid and profound change takes place in the 
course of civilization. Ideas are as much disturbed as 
empires, and for the first time for many centuries, the 
world seems summoned to the definitive struggle between 

209 



2IO HISTORY OF POLITICAL ECONOMY. 

despotism and liberty. The discovery of America, the 
expulsion of the Moors from Spain, the Protestant re- 
formation, the trade in blacks, are events contemporary 
with Charles V, and each of these events bears the germ 
of twenty future revolutions. To the municipal regime 
which had been established under the influence of labor, 
in all the free cities of Germany, Belgium, Spain and the 
Italian republics, succeeds the domination of a few power- 
ful monarchies, which divide Europe among themselves, 
after having ruined it. Charles V was the principal in- 
strument of that revolution, the consequences of which 
were to be so fatal to political economy, by putting un- 
der the protection of force the worst doctrines which 
have afflicted humanity. 

The necessity of carrying on the constantly renewed 
wars, reduced this monarch in the first years of his reign, 
to financial expedients which deprived productive indus- 
tries of the greater part of their capital, and swallowed it 
up in the gulf of sterile consumption. His treasury was 
always empty ; his troops were badly paid, and they ac- 
quired the habit of living by pillage, extortions, or arbi- 
trary taxes. Violent and oppressive measures everywhere 
supplanted the regular system of taxation established by 
Italian financiers. Then began extortions of every kind, 
quartering of soldiers on the people, and excessive taxes 
on consumption, which augmented the price of hand-work 
to the detriment of manufactures. Import duties were 
increased upon raw products. For the free practice of 
the arts, was substituted the monopoly of trades and of 
commerce. Everywhere arose, flanked with privileges, 
imperial or royal manufactures, from which it was neces- 
sary to purchase licences in order to have a right to work. 
All these restrictive measures became by degrees incor- 
porated in the laws and established by custom ; then 
came sophists who embodied them in doctrines ; and thus 
all the economic heresies with which Europe is still in- 
fested have become so much the more difficult to destroy, 



AUSTRO-SPANISH IMPERIAL SYSTEM. 211 

since they present themselves with the sanction of time 
and the character of authority. Charles V rendered 
them more harmful by organizing them and making them 
penetrate the administration, of which they were to be- 
come the rule of conduct and the inviolable dogma. 

A more deplorable result of the Austro-Spanish impe- 
rial system was the restoration to honor of the aristocracy 
of parchment and of the sword, which was beginning to 
disappear before the notabilities of manufactures and 
commerce. The nobility of the Italian republics, of the 
Hanse towns, and of the great Belgian, French, and 
Spanish mercantile cities, worked, at least, and took pride 
in having descended from working people ; but Charles 
V began to sell titles in order to have money, and the 
Castilian prejudice, which makes nobility consist in idle- 
ness, spread like a plague through all Europe. So one 
single reign sufificed to put public liberties back to the 
worst days of feudalism. Every day some great indus- 
trial enterprise withdrew from the arena, where it was no 
longer able to maintain itself without derogation. The 
lords had ceased to plunder the passers-by on the high- 
ways, as their predecessors did from the height of the 
old donjons; but they retrenched themselves in privi- 
leges which secured to them the best part of the profits 
of the labor of their fellow citizens. Multitudes of farm- 
ers of the revenues caused the farming of them to be ad- 
judged to themselves ; and one of the governors for 
Charles V, in the conquered countries, dared respond to 
the royal orders : " The king commands at Madrid, and 
I at Milan." There was no more public discussion, no 
more recourse to justice possible ; no more consular juris- 
diction, no more credit : all the protecting forms had 
been abolished to make room for the absolute regime of 
Spanish pachas. 

But it was not alone in Italy and in the states 
of Charles V that people had to deplore this sudden 
change in the course, and above all in the doctrines of 



212 HISTORY OF POLITICAL ECONOMY. 

governments. To any one who remembers the scrupulous 
fidelity of the Venetians, the Florentines, the Genoese, 
and the Hanse towns, in keeping their engagements, the 
hazardous expedients to which the policy of the emperor 
of Germany accustomed and forced the other princes by 
his example and his continual wars, will appear more dis- 
astrous than the immediate damage which resulted from 
it. Nothing contributed more to paralyze social develop- 
ment, than the fear and uncertainty which extended to 
all relations which needed guaranties and security. Upon 
what basis could one henceforth found the best specula- 
tion, when the principal sources of the public revenues 
were alienated in advance for several years, and the coins 
changed either by boldly debasing them with alloys, or 
by spoliating decrees ? Money also, for which no profit- 
able and sure investment could be found, soon deserted 
the industrial arts and became immobilized in purchases 
of lands. Agriculture, vitally injured by the decline of 
commerce, was soon ruined under the influence of legis- 
lation which prohibited the export of grain. To com- 
plete the misfortune, the numerous changes brought 
about in the administration of the states overpowered by 
the war, afflicted Europe with a plague revived from the 
Lower Empire : we mean the law-suits and quarrels of 
every kind, with their usual cortege of rapine and of 
lawyers. The dazzling splendor of the fine arts never 
atoned to Italy for the decline which followed the loss of 
her freedom ; and the continual decrease of her popula- 
tion has sufificiently demonstrated, since then, that the 
true elements of the prosperity of states consist in useful 
arts rather than ornamental ones. 

The reign of Charles V was especially adverse to the 
progress of political economy, because he turned Europe 
violently away from the regular paths of production, to 
precipitate it into the hazards of war and the old system 
of exploiting men, which was engendered by feudalism. 
All the false doctrines and injurious prejudices which we 



DEBASED COIN. BAD COMMERCIAL LAWS. 213 

to-day have to combat, we owe to his government, con- 
tinued and made worse under his execrable successor. 
Freedom of trade was going to be estabHshed in the 
world and to rally in a common solidarity the interests 
of the south and of the north : Charles V substituted 
for it restrictions and prohibitions. The banks of Venice 
and Genoa had just founded credit : Charles V began to 
make debased coin ; and, although the treasures of the 
new world were so open to him as to bring him in nearly 
fifty millions of francs a year, he flooded Europe, about 
1540, with a considerable mass of debased coin of Cas- 
tilian gold. This detestable example found only too 
many imitators ; and there was a time when, according 
to the expression of M, Ganilh, " Italy was as much noted 
for her bad moneys as for her excellent works upon 
money." Wealth was no longer sought in labor and the 
intelligent employment of capital, but in the accumula- 
tion of specie, the export of which was prohibited by 
draconian laws ; as if it were possible to buy the com- 
modities one no longer produced himself, and to keep the 
money which served to pay for them. Then came about 
the first attempts at those strange theories the invention 
of which belongs entirely to the Spaniards, and which an 
economist of their country summed up so naively, two 
hundred years later, in this remarkable passage : " It is 
necessary rigorously to employ all the means which can 
lead us to sell to foreigners more of our productions than 
they will sell us of theirs : that is the whole secret and the 
sole advantage of traded ^ ■ 

* Ustariz, Thhrie et pratique du Commerce, cha.p. iv, p. 13, of the French 
edition. That author added : " If we could at least remain on a par of 
exchange, it would still be enough to keep in Spain the greater part of the 
wealth which comes from the West Indies to Cadiz, instead of which it can- 
not to-day be to us of any utility. On the contrary, these treasures become 
injurious to the monarchy, if, from the very port where they arrive, they 
pass at once into the hands of people who are our rivals, who carry them in 
great quantities into the countries under the dominion of the Turks. Thus, 
besides the misfortune of being deprived of our silver as soon as it arrives at 
Cadiz by fleets or gallions, and the disagreeable circumstance of seeing it 
carried away by nations little friendly to us who make use of it to increase 



214 HISTORY OF POLITICAL ECONOMY. 

Such is the system which has given rise to the innu- 
merable wars of which Europe has been the theatre since 
the accession of Charles V, and which still unconsciously 
dominates the commercial policy of almost all modern gov- 
ernments. All have used their strongest efforts, from that 
time, to retain money and to proscribe foreign merchan- 
dise ; all have thought they saw in importations a cause 
of ruin, without perceiving that importations were be- 
coming so much the more necessary as interior produc- 
tion diminished, among each people, exactly in propor- 
tion to the restrictions imposed in order to give it in- 
creased activity. It was besides, pursuing a chimera, to 
attempt to sell without buying, and to aspire to the mo- 
nopoly of manufactures, while abandoning the great 
works of industry for the product of the mines. Spain 
has since cruelly expiated that fatal error of Charles V : 
she lost her manufactures because of having attached too 
much importance to the gold of her colonies, and later, 
her colonies escaped from her, because she had too much 
neglected her manufactures. 

But this bad system was not the only error to which 
Charles V gave currency in Europe. Humanity can se- 
riously reproach his memory for having reestablished, on 
an immense scale, slavery, which was just dying out, and 
the exploitation of human beings, which was near its end. 
The trade in negroes was organized during this reign as 
a legitimate and regular institution, and the fatal doctrine 
of the Greeks and Romans was revived, by virtue of 
which the profits of social labor belonged of right to a 
few privileged individuals. Millions of men perished in 
America, victims of this detestable prejudice, and Africa 
has not yet ceased, after three hundred years, to pay its 
tribute of blood and tears to the system which has been 

their commerce and their opulence, we have the pain of knowing that a 
great part of these millions pass to the Turks and other infidels to htcrease 
their power and our losses. These baneful consquences merit the greatest 
attention and the most secure measures to prevent them." 

And yet Ustariz wrote these lines in 1740, and he had been a minister ! 



POLITICAL ECONOMY OF CHARLES V. 21$ 

the result of it. One can form no idea of all the ab- 
surdities which were invented at that epoch, to secure to 
the men of the metropolis the benefits and revenues of 
the new colony: never was the audacity of privilege 
manifested in a manner so tyrannical. The metropolis 
imposed all its products on the colony, and forbade it to 
procure them for itself, even on its own soil. The Amer- 
icans were forbidden to plant flax, hemp and the vine, to 
establish manufactures, to build ships, and to have their 
children educated elsewhere than in Spain. At the same 
time certain useless articles of consumption were pre- 
scribed for them, and they were subject to exactions the 
history of which would to-day seem fabulous. The whip 
of the commander represented at that time the whole of 
Spanish civilization. 

While the maxims of the government of Charles V 
protected in America the establishment of slavery and of 
the most odious monopolies, in Europe they encouraged 
in every way despotism and idleness. Convents were 
multiplied and endowed at the expense of agriculture 
and labor. The inquisition lighted its thousand fu- 
neral piles against civil and religious liberty ; magnifi- 
cent but useless monuments succeeded those numerous 
constructions of public utility which had so brilliantly 
distinguished the administration of the Italian republics. 
One would have said that no one in Europe was to be 
provided with an abode, except five or six demi-gods in 
the temples ; the human species might esteem itself happy 
to crawl under thatch. This was the epoch of all bad 
ideas, of all bad systems, in arts and manufactures, in 
politics, and in religion. We do not to-day commit a sin- 
gle error, nor follow a single industrial prejudice, which 
was not bequeathed to us by that mischievous power 
which was strong enough to convert into law its most 
fatal aberrations. No, never will science find terms strong 
enough, nor humanity tears enough, to stigmatise and to 
deplore the ill-omened acts of such a reign ! Philip II, 



2l6 HISTORY OF POLITICAL ECONOMY. 

of unfortunate memory, only carried them to their re- 
results ; it was Charles V who laid their foundations. 
But the crimes of the son ceased with his life, while the 
doctrines of the father hinder still, after three centuries, 
the progress of civilization. 

Noble and sublime protests have nevertheless been 
offered against these grave attacks upon the imprescrip- 
tible rights of humanity. Spain still religiously preserves 
the remembrance of the heroic attempts of Padilla and 
the municipal towns of the Peninsula which followed the 
impulse of his patriotism. It was a fine reflection of the 
ancient independence of the communes, and one can 
judge by what they asked, what Charles V had made 
them lose. " We ask," said the chiefs of the provincial 
league, in their celebrated remonstrance to this prince, 
" that the people no longer furnish gratuitous lodging for 
troops ; that all taxes be reestablished as they were at the 
death of Isabella ; that in the states which shall maintain 
the succession, each city send one representative of the 
clergy, one of the nobility, and one of the third estate, 
each elected by his order ; that no member of the states 
receive either office or pension from the king, whether for 
himself or for persons of his family, under penalty of death 
and confiscation of his property; that each city or com- 
munity pay its representative a salary suitable for his 
support during the time he shall be present at the states, 
and that the lands of the nobles be subject to all the pub- 
lic taxes, the same as those of the communes^ * Such was 
the political economy of the liberal party of that time ; 
but the death of Padilla f and the defeat of the Spanish 

* Robertson, History of Charles V, book iii. 

f Sandoval, History, vol. i, p. 478, has preserved for us the admirable 
letter which Padilla MTote to the city of Toledo the night before his execu- 
tion. We must reproduce a few of the last thoughts of this martyr of com- 
munal franchises. " To thee the crown of Spain and of the entire world ; 
to thee who wert free, from the times of the powerful Goths, and who by 
shedding the blood of strangers and of thy own people, hast regained liberty 
for thyself and for the neighboring cities : thy legitimate child, Juan de 
Padilla, informs thee how by the blood of his veins thou oughtest to renew 



DEVELOPMENT OF WEALTH RETARDED. 21/ 

insurrection permitted Charles V to lay the weight of his 
iron yoke upon the greater part of Europe, henceforth 
delivered up to the pillage of his troops and to the con- 
tagion of his doctrines. France even was obliged to de- 
scend into the arena,* where she fought long with glory, 
if not always with success, until the powerful diversion of 
protestantism in Germany again placed all liberties un- 
der the protection of a principle. 

Thus, from whatever point of view we look at the his- 
tory of Charles V, we cannot help recognizing that this 
monarch hindered the magnificent development of wealth 
and prosperity created by the emancipated bourgeoisie of 
the middle ages. By attempting to reconstruct the uni- 
versal monarchy of Charlemagne and to take away from 
the various European states their physiognomy as well as 
their independence, he condemned them to the scourge 
of standing armies and anticipated-taxes. He reestab- 
lished slavery in America, then nearly abolished in Eu- 
rope. He concentrated in his single person and in that 
of a few princes, his allies or his rivals, the power of the 
sovereignty, which the middling classes had begun to 
share. These are, without doubt, grave charges, in the 
eyes of posterity ; but there are still graver ones, the con- 
sequences of which were not less deplorable. The gov- 
ernment of Charles V was one of those which have con- 
tributed most to spread over the world the hideous evil of 
pauperism. Did he not, by destroying the freedom of the 
industrial arts and of commerce, turn towards the con- 

thy ancient victories. If fate has not decreed that my acts should be placed 
in the number of the successful and famous exploits of thy other children, 
it must be imputed to my bad fortune and not to my will. I pray thee, as 
my mother, to accept the life I am about to lose, since God has given me 
nothing more valuable which I can lose for thee. * * * j ^[\i write 
thee no more about it : for at this very moment I feel the knife near my 
bosom, more touched at the grief that thou wilt feel, than at my own 
wrongs." 

* " In one of these numerous wars, in 1552, a French army of 44,000 men, 
commanded by the constable of Montmorency, invaded the three bishoprics, 
preceded by a manifesto in French and German, the frontispiece of which 
represented a cap with two poniards, surrounded by the word LIBERTY." 
Schoell, History of European States, vol. xv, p. 160. 



2l8 HISTORY OF POLITICAL ECONOMY. 

vents a multitude of beings condemned to choose be- 
tween a contemplative life and one of beggary? Did he 
not, by creating the colonial system, accustom one part 
of his subjects to live at the expense of the other? Did 
he not favor the establishment of the society of Jesuits, 
so fruitful in inventions fatal to labor and to freedom ? 
Was it not he that made such a melancholy funeral for 
the Italian republics ? 

But the bad genius of a single man could not prevail 
against the eternal destinies of the human race. While 
fortune seemed to smile on Charles V and to crown all 
his enterprises, there arose in old hard-working Germany 
a power which was to destroy the fruit of his victories 
and prepare great humiliations for his successor. Free- 
dom of inquiry reappeared at the voice of an irritated 
monk. The germs of independence, scarcely stifled in 
the Hanse towns, were starting anew under the hot 
preaching of protestantism. Oppressed peasants flew to 
arms ; most courageous writers preluded by bold essays 
the eloquent manifestoes of the eighteenth century.* 
Smuggling and interloping deadened the effect of the 
nascent monopolies. The annoyances caused by the 
farmers of the revenues, the venality of the offices, and 
the weight of the taxes, made people feel the value of 
order in the finances and the need of consideration among 
the magistrates, and strengthened the education of the 
people by hard experiences. The spirit of enquiry which 
em.anated from the protestant reformation had just pene- 
trated all social questions : it is important to study 
its economic consequences before touching upon those 
which followed the discovery of America, for these two 
words, reformation and new world are full of memorable 
instruction. 

See Le Contr'un, by La Boelie, p. 125. 



CHAPTER XXII. 

The Protestant Reformation and its influence upon the course of political 
economy. — Secularization of the monks. — Sale of church property. — Im- 
portance ot such property in England at that time. — Poor-laws. — Increase 
of working-days. 

There is something truly providential in the advance 
of labor and of liberty. Persecuted at one point, they take 
refuge in another : arrested in their onward course, they 
start forward the more earnestly for the future as soon as 
the way is again open. To Greek and Roman slavery 
succeeds barbaric independence : the latter, in its turn, 
scarcely changed by feudal servitude, reappears more bril- 
liant and more strong in the affranchised communes. 
The glebe succeeds the mill-stone, and corporations pre- 
cede freedom of labor. When one experiment has had 
its season, it returns to the darkness of the past and sud- 
denly the new experiment begins, charged with transmit- 
ting to posterity the principal and interest of all which 
have preceded it. The protestant reformation is one of 
these grand revolutions in the majestic development of 
humanity. Its beginnings were very humble ; but its re- 
sults have changed the face of Europe. Leo X had seen 
in it only the revolt of a monk, and Charles V only an 
infraction of the dogma of passive obedience ; but un- 
der the revolt of the monk was hidden a protest against 
the exploitation of Christendom by the bishop of Rome, 
and the appearance of Luther at the diet of Worms was 
only the prelude of the League of Smalkalde, that is to 
say, of the first confederation of small states against the 

219 



220 HISTORY OF POLITICAL ECONOMY. 

despotism of the great ones. Moreover, from the first 
lightning flash of that tempest, it became evident that 
the thunder-bolt would strike institutions supposed to be 
consolidated by time, but which time had undermined. 
As the discovery of the Cape of Good Hope had just 
wrested from the Venetians the monopoly of commerce, 
the establishment of protestantism took from the Pope 
and emperors the domination of Europe. The Guelphs 
and Ghibelines were put out of consideration, and social 
questions appeared in an entirely new light. 

One cannot help recognizing a sort of consoling and 
marvellous correlation between these great contemporary 
events, such as the trade in blacks and the Protestant re- 
form which was destined to put an end to it ; the univer- 
sal monarchy of Charles V and the formation of the Ger- 
man states, which were joined later by all Sweden under 
the lead of the great Gustavus Adolphus, and by the 
United Provinces of Holland, immersed in blood by 
Philip n. But we have to consider them only from an 
economic point of view, and although, for that examin- 
ation, most historians are not very safe guides, the results 
present so pronounced a character, that they need but be 
indicated, to make their importance perceived. It was at 
first only a refusal to pay for the indulgences by means of 
which Rome was obtaining money in even the smallest 
villages ; * but this refusal became the era of a first re- 
form in the system of taxation, and it is not so far as 
one may think from that reform to the financial discus- 
sions of modern constitutional parliaments. In Ger- 
many, the petty princes had soon comprehended all the 
advantages they could derive from the religious enthu- 
siasm, to lead on their people to resistance to the ambi- 

* I have had in my hand the original of a certificate of plenary indulgence 
accorded for the sum of one franc, fifty centimes in our money (less than 
thirty cents. — Trans.'). It there says literally : " Veniam damns Joanni N. 
pro omnibus peccatis, praeteritis, prtesentibus et futuns, quantumcumque 
enormibus." * * * "phg beneficiary had added in the margin, perhaps 
imprudently, the name of his wife, who thus found herself included in the 
indulgence, over and above the bargain.— ^«MorV Note. 



SECULA-RIZATION OF MONKS. 221 

tious projects of Austria. Besides, the allurement of the 
treasures of the clergy, which each protestant sovereign 
added to his fiscal resources ; and that of independence 
and intimate union, which the common cause established 
between all the confederates, decided the most timorous 
to run the risks of the league and to found the first 
efificacious coalition of free states against the preponder- 
ance of their oppressors. 

The first result of the struggle, and the one most im- 
portant to political economy, was the secularization of 
the monks and the sale of the property of all the religious 
communities, or its addition, pure and simple, to the 
public domain. This property had already great value, 
and it acquired considerably more by passing into labor- 
ing hands, on coming forth from the unproductive regime 
of mortmain, to which it had been long subject. The 
nobility had their share of it as well as the sovereign 
princes, and one portion was applied with more or less 
equity and discretion to the maintenance of worship, of 
the poor, and of public educational institutions. When 
the reformation penetrated into England, the change was 
still more sensible, and it was effected there on such 
bases, that it may be considered a virtual revolution. 
There the clergy possessed seven-tenths of the landed 
property,* and the thousand and forty one religious 
establishments in the kingdom, in the time of Henry 
VIII, enjoyed a revenue of about six millions of francs 
in our money, an enormous sum for that period, by rea- 
son of the scarcity of money and the smallness of the 
national revenue. 

The suppression of a great number of days improperly 
made holy days, restored to labor millions of hands ac- 
customed to lying idle, and furnished new elements of in- 
crease to public wealth. But, at the same time, that en- 
ormous mass of laborers, voluntary or forced, thrown 
into circulation on coming forth from the convents which 
had defrayed the expenses of their idleness, occasioned 

* J. Wade, History of the Middle and Working Classes, p. 3S. 



222 HISTORY OF POLITICAL ECONOMY. 

unforeseen modifications in the social organization and 
made pauperism appear under a new aspect. There were 
two sorts of poor: those who under the preceding regime 
had been accustomed to ask alms, and those who had 
given to them. Their number even became so large 
that it was necessary to have recourse to legislation to re- 
strain them, and to regulate the hard conditions which 
the reform of the convents had imposed upon them. 
Most of them obstinately refused to labor, and those 
who resigned themselves to it, did not always find work. 
What was to be done with that adventurous and nomad 
population, with those unhappy roundsmen, seeking 
bread and work from door to door, most frequently 
without finding either! Catholicism had created that 
pest by multiplying convents : protestantism aggravated 
it by suppressing them. Who would have thought it 
when the work was begun ! 

Besides, that epoch was more fruitful than any other in 
legislative and administrative measures of every kind, to 
compel vagrants to have a permanent abode, and to make 
idlers work. The annals of England are full of these meas- 
ures ; and in looking them over, we know not whether to 
be more astonished at their powerlessness or their multi- 
plicity. In 153 1, Charles V had published in the Nether- 
lands a long edict on this subject as sterile as all the 
analogous ordinances of the kings of England. He had 
forbidden any person except the monks and pilgrims to 
beg under penalty of flogging and imprisonment. Those 
known to be needy were to be maintained by means of 
regular collections at the doors of the churches, hospitals, 
and houses of refuge, and the magistrates were authorized 
to take collections in the churches or in private houses 
once or twice a week for the same object. Recalcitrant 
idlers* could be compelled to work. But all these se- 
vere measures in Belgium, England, and Germany, only 
served to make more evident the absurdity there was in 
decreeing, by ordinance, public prosperity, 

* Anderson. History of Commerce, vol. ii, page 55. 



RESULTS OF SECULARIZATION. POOR-LAWS. 223 

This strange pretention was pushed in England and in 
the protestant countries to the extreme limits. The sup- 
pression of convents in them, converted, at one stroke of 
the pen, more than five thousand monks into miserable 
pensioners of the state, and threw them, without being 
accustomed to labor or to the world, into the midst of the 
needs and seductions of an industrial society. Correc- 
tions, chastisements and tortures were of no avail to these 
men inured to idleness, and who besides had not all at 
their disposal the means of labor. How was compulsory 
idleness among them to be distinguished from that which 
was voluntary? That question is not yet settled in Eu- 
rope, although it has been propounded for several centu- 
ries, and it daily becomes complicated in the progress 
of industry and civilization, by a multitude of difficulties, 
which render it more and more difficult of solution. In 
vain did protestantism produce in contrast to the blind 
charity of the catholics, the severity of the poor laws ; 
there has been only one result from them, which is, that 
the poor of protestant countries are obliged to hide their 
poverty, while those of catholic countries can exhibit it 
without fear ; but the wretchedness is not the less real in 
the two camps. Who knows, indeed, whether the poor- 
tax has not contributed to multiply them more in Eng- 
land than in Spain, by securing to them, at the expense 
of the parishes, a regular and compulsory revenue, in- 
stead of the precarious resource of alms ! 

One has, however, no right to blame protestant influ- 
ence for the consequences of the principle it has laid 
down. The suppression of monasteries and the sale of 
their property were wise means and dictated as much by 
reason as by necessity. At another time, too, when per- 
sonal slavery and also serfdom were suppressed, one 
might have been disposed to calumniate liberty on seeing 
the embarrassment which t\\os& prol^tatres without prop- 
erty and suddenly emancipated and delivered up to them- 
selves, experienced in regard to means of subsistence. 



224 HISTORY OF POLITICAL ECONOMY. 

Liberty imposed upon them the necessity of earning 
their livelihood by the sweat of the brow, and of justify- 
ing their dignity as free men, by work, which is its dis- 
tinctive sign and essential condition. This was a condi- 
tion which protestantism required of all its citizens, as 
the numerous and varied wants of our present civilization 
demand more work, because they produce more enjoy- 
ments. It would not then be just to make either religion 
responsible for the existence of an evil inherent in human 
nature and which has continually been reproduced under 
all religions and all regimes. It suffices to know at that 
time what was the mode of life of the working people, 
to form an idea of the miseries which awaited the indi- 
gent without work and even the farmer on his land. 
Erasmus tells us that most of the houses were yet with- 
out chimneys, and that the people in them trod the bare 
ground for lack of tiles or bricks ; the beds consisted of 
a heap of straw rarely renewed, and a badly-hewn block 
of wood served as a pillow, Fortescue, who traveled 
over France at that time, said of our peasants : " They 
drink water, eat apples, make rye bread of a dark color, 
and do not even know what meat is." 

The definitive establishment of protestantism in Eu- 
rope contributed much to change this sad state of things. 
If the suppression of convents did not resolve the 
question of pauperism which their multiplicity had com- 
pHcated, it at least forced a part of the idlers to seek 
means of subsistence in labor. Too great a number of 
holy days were a loss to production ; the protestants re- 
duced it to suitable proportions, and soon the countries 
where the reforms had triumphed presented striking con- 
trasts to the catholic countries. As far as the popula- 
tion could no longer live by alms, they contracted more 
industrious and more regular habits, which still remain, 
and which distinguish them in a very remarkable man- 
ner in Europe. It is since the schism of Henry VIII and 
the abolition of convents that England has progressed, 



PROTESTANT AND CATHOLIC COUNTRIES. 22$ 

through the most cruel vicissitudes, to its present devel- 
opment. Germany also owes like results to protestant- 
ism, and this very day the catholic part of that fine coun- 
try is inferior in civilization, wealth and intelligence to 
the protestant part. Look at Geneva and the Swiss re- 
formed cantons ; how different from the catholic cantons ! 
The prosperity of Holland, after its revolt against the 
Spanish monopolists and persecutors, was attributable to 
no other cause. In France itself, when later, Louis XIV, 
under an evil inspiration, signed the famous revocation 
of the edict of Nantes, the protestants, banished from 
the territory, went abroad giving lessons in the indus- 
trial arts to all Europe. Flanders, Switzerland, England 
and Prussia ^ were enriched by the fruit of their labors. 
Their ardent and strict proselytism attracted many gen- 
erous minds and made them accept sacrifices which the 
indolent and luxurious ease of Catholicism would have 
always rejected. The simplicity of their worship and of 
their dress saved to industrial enterprises an immense 
amount of capital, which, throughout catholic Europe, 
was consecrated to maintaining the majesty of the tem- 
ples and the luxury of the prelates. 

The revolution was not less decisive in everything which 
closely appertains to the social questions debated since 
the beginning of the centuries. The spirit of association 
led the catholic ranks to attack, and the protestant ranks 
to defend themselves. Printing, which had just been 
invented, was a new weapon which served both parties 
to their advantage, and took its rank among the powers. 

*" At the accession of Frederick William to the regency," says a German 
writer, a prince of the house of Brandenburg, " no hats, stockings, serges, or 
any woolen cloth, were made in this country : the industry of the French en- 
riched us with all these manufactures. They established works for making 
cloth, serges, bunting, small goods, druggets, caps, and stockings woven 
upon stocking frames ; beaver, goat-skin, and rabbit-skin hats, and dyes of 
all kinds. Some of these refugees became merchants and sold at retail the 
products of the others. Berlin had goldsmiths, jewellers, clockmakers and 
sculptors, and the French who settled in the Netherlands cultivated tobacco 
and brought excellent fruits and vegetables into the sandy districts, which, 
3nder their care, became admirable kitchen gardens." 



226 HISTORY OF POLITICAL ECONOMY. 

The purely intellectual struggle ;vhich was established at 
the outset, forced the dissenters to study and reason ; 
and the light born from error and trouble, finally ex- 
tended to subjects which appeared most foreign to these 
disputes. One reform led to another : philosophy was 
substituted for scholasticism, and the morality of the 
casuists vanished before that of the gospel. Every body 
began to work, and beside the greatest modifications in 
religion there came about unlooked-for industrial changes. 
Thus, the simple suppression of the days of abstinence 
prescribed by the command of the catholic church, led 
to a considerable diminution in the number of vessels de- 
voted to fisheries. Holland consumed more meat in pro- 
portion as she consumed less fish. Her mariners became 
agriculturists, and they raised cattle instead of fishing for 
herrings. The reaction of the protestant reformation 
produced also other effects of a higher order, although 
more indirect. When Philip H seized Portugal and 
closed the entrepot of Lisbon to the Dutch merchants 
accustomed to buy there merchandise from the East, 
the latter went directly to the Indies and there laid the 
foundations of their colonial power. A religious caprice 
of this bad prince caused the Spanish to lose the empire 
of the sea. 

But it was given to protestantism to assume a higher 
character and to exercise a more general influence, when 
it had borrowed the help of the French language, which 
had just become popular in Europe. From this time, 
the reformation became an auxiliary to politics ; and the 
religious wars which have desolated our country, suffi- 
ciently prove that doctrines and their consequences had 
been taken into serious consideration. The poor masses 
began to comprehend the importance of a change which 
relieved them from ecclesiastical tithes, and the higher 
classes did not view without interest the religious move- 
ment which restored to them freedom of investigation 
and independence of thought. The property of the 



PROTESTANTISM AUXILIARY TO POLITICS. 22/ 

church, previously exempt from taxation, reverted to the 
public domain and relieved the tax-payers from the bur- 
den of the innumerable taxes by which they were over- 
whelmed. A part of it went back- to the aristocracy and 
attached them to the new ideas, by increasing at the same 
time their importance and their fortune. The petty 
princes of Germany had welcomed these ideas as a means 
for rallying the people against the domination of Charles 
V ; the noblemen of France became attached to them to 
increase their local influence and because protestantism 
accorded perfectly with their provincial habits. There 
was a time when Europe was divided between protestant 
federalism and catholic unity. It would now be covered 
with great, free cities like the Hanse towns, or small in- 
dependent states like the Italian republics, if the Calvin- 
istic principle had completely triumphed ; it would have 
been absorbed into two or three great monarchies, per- 
haps into one alone, if this principle had entirely dis- 
appeared. What would have become of civilization, in 
either event? We cannot say ; but the prosperity of the 
protestant countries permits no doubt that the reforma- 
tion would have given much activity to the development 
of public wealth ; we should not have seen the social 
revenues of Europe devoured by three or four belligerent 
powers, more occupied with the interests of their aggran- 
dizement and their policy than with the well-being of the 
people. 

Protestantism must have contained within it fertile 
germs of the future, since wherever it has become estab- 
lished, people have contracted more regular habits, 
stricter morals, and a more pronounced inclination to 
labor. Compare Holland and Portugal, England and 
Spain, Lutheran Germany and Catholic Germany : what 
a contrast in respect to intelligence, wealth and morality ! 
What a difference between the life which reigns on the 
one side and the apathy in which the others vegetate ! 
One can well judge of it in future ii? \merica, where 



228 HISTORY OF POLITICAL ECONOMY. 

civilization seems to have established its two extremes : 
the United States of the North have attained the highest 
degree of prosperity under the influence of free investi- 
gation and with a protestant population ; the republics 
of the South, notwithstanding the natural advantages of 
their climate and the richness of their soil, have not yet 
been able to establish a regular government because of 
their catholic prejudices. Idleness and beggary reign 
there always, as formerly in their parent country, while 
the labor of the Americans in the North has brought the 
forests under cultivation and peopled the deserts with 
opulent cities in less than fifty years. Unfortunately, 
protestantism, so successful in multiplying wealth, has 
not yet found the secret of distributing it with impar- 
tiality among all the classes which produce it. It has 
broken the bond which united Christian nations, and sub- 
stituted national egoism for the universal harmony to 
which Catholicism was tending. There is no longer any 
common thought in Europe to-day in a position to rally 
minds and convictions. In the industrial arts, in politics, 
in philosophy, in religion, ideas float, swayed by the 
breath of revolutions. Each day undoes the work of the 
preceding. People dispute with each other for the mar- 
kets, and enter into competition, instead of associating 
themselves together under the guidance of their necessi- 
ties and for the exchange of their respective products. I 
desire before all to be just, but I cannot help acknowledg- 
ing that if the former Catholicism did not know how to 
put itself at the head of the production of wealth, we 
cannot reproach it with that barrenness of doctrines, in 
virtue of which distribution takes place in a manner so 
little equitable in protestant countries. Science, then, 
must to-day assume the functions of this great priest- 
hood, by preaching peace and solidarity to nations, and 
by demonstrating to them that their interests are one, 
notwithstanding the apparent opposition which they 
present. This truth will appear more striking after a 
rapid examination of the colonial system. 



CHAPTER XXIII. 

Consequences of the discovery of the New World. The European 
colonial system in the two Indies. 

The large profits which the Venetians derived from 
their trade with India, had for a long time excited the 
emulation and the jealousy of other nations. During all 
the fifteenth century, the Portuguese had been unremit- 
ting in their search of a route by sea to the countries 
whence the Moors brought to them, across the desert, 
ivory and gold dust. It was in this search that Vasco de 
Gama proceeded from port to port along the coasts of 
Africa, as far as the Cape of Good Hope, and discovered 
the shores of Hindustan, in 1497, after a voyage of eleven 
months. Five years previous, Christopher Columbus 
touched America and endowed his country and the world 
with a new hemisphere. Europe then finds herself sud- 
denly and without preparation, launched in the way of 
colonial conquests, which were to exercise so profound 
an influence over her destinies. 

One cannot exactly compare the system she pursued in 
regard to them, with that which guided the Greeks and 
Romans in their settlements of the same kind. The 
Greek colonies had generally been peopled by citizens 
compelled to expatriate themselves, by the violence of 
factions or by the impossibility of finding a sufficient sub- 
sistence in their country. We have seen that these colo- 
nies enjoyed a certain independence, and that most of 
them became virtual empires. The Roman colonies had 

229 



230 HISTORY OF POLITICAL ECONOMY. 

risen upon different bases : their internal administration, 
less independent than that of the Greek possessions, wa? 
modeled on the regime of the metropolis, which con- 
sidered them at the same time as asylums for poor or dis- 
contented citizens and as military outposts in a foreign 
country. Nothing similar is found in the thought which 
inspired the Spanish and Portuguese expeditions, and 
which has directed, since, all the settlements of the Eu- 
ropeans in the two Indies. It was in search of gold and 
wealth that Vasco de Gama and Christopher Columbus, 
those preeminent adventurers, were sailing with heroic 
perseverance, when they arrived on those shores where 
their appearance was to cause so much blood to flow and 
so many tears to be shed. One has only to read the 
recital of their first exploits, to be convinced that their 
aim was neither to civilize, nor even, although they may 
have said so, to convert the population, but to rob them, 
exterminating them, if necessary. 

When Christopher Columbus returned to Europe and 
was presented in great pomp at the court of Castile, that 
which most agreeably impressed his illustrious hosts, was 
a collection of plates of gold, gold bracelets, bits of gold, 
mingled with some bolls of cotton, which he brought 
with him from the newly-discovered countries. Fernando 
Cortez and Pizarro sought for nothing else in their bold 
expeditions to Mexico and Peru, and we know their sur- 
prise and joy at the sight of the treasures they went to 
conquer. It was love of gold which led these courageous 
filibusterers to the ends of the earth and made them sur- 
mount the most formidable obstacles. Wherever they 
set their foot, they asked information about gold, and 
they reembarked when there was none to ravish. To 
this cause must be chiefly attributed the slow progress of 
the Spanish colonies. The gold and silver accumulated 
by the natives were soon exhausted, and the waves of 
emigrants which followed the conquest employed all their 
activity in labors, generally unproductive, in the mines. 



AMERICA CONSIDERED AN ELDORADO. 23 1 

It was only after long and fruitless attempts in that haz- 
ardous career, that it was perceived that the American 
soil contained rich resources productive in quite a dif- 
ferent way from its mines of gold and silver. 

But the prejudices engendered by that fever for the 
precious metals did not disappear with the circumstances 
which had given rise to them. Every one knows the 
dream of Sir Walter Raleigh of the golden city and the 
country of Eldorado. More than a hundred years after 
the death of Sir Walter, the Jesuit Gumila was still per- 
suaded of the existence of that marvelous country, and 
he expressed with much warmth how happy he should be 
to be able to carry the light of the gospel to a people 
who could so generously reward the pious labors of the 
missionaries.* Every Spaniard thought he was embarking 
for the promised land in setting sail for America. The 
cupidity of the multitude was continually excited by ex- 
aggerated reports, to which we must pardon them for 
having given credence, in consideration of the treasures 
which they continually saw arrive from these romantic 
places. By degrees the entire Spanish nation became ac- 
customed to the idea of making a fortune without work- 
ing, and they not only scorned agricultural occupations, 
which might have changed the face of America, but those 
which were necessary to themselves to prevent the de- 
cline of their own country. Every Spanish citizen be- 
lieved himself a nobleman invested with his fief in the 
New World, and the colonial legislation soon strengthen- 
ed this fatal prejudice. America was considered as na- 
tional property of the parent country, and the latter 
imposed on it rules, the tyrannical absurdity of which 
became equally disastrous to the two countries. We 
have already mentioned some of them in our rapid sketch 
of the political economy of Charles V. 

Such was the origin of the colonial prejudices which so 
long hindered the prosperity of the world and made the 

* Adam Smith, Wealth of Nations, Book iv, chap. vii. 



232 HISTORY OF POLITICAL ECONOMY. 

discovery of the new continent sterile in the hands of its 
authors. Negro slavery, that shame of civilization, is 
only one episode of them ; and although it still exists, 
we hope its last knell will soon be sounded. But there 
are other vices which will long be incurable, because their 
origin dates back to the early days of the conquest, and 
because they have profoundly penetrated our colonial 
morals. People of every rank have been too much ac- 
customed to living at the expense of the workers ; and 
while in Mexico and Peru the colonists pitilessly ex- 
ploited the unhappy natives, the parent country, not less 
unmerciful, was taking from the colonists the fruit of 
their rapine, under the names of tariffs, tithes, alcavala 
and twenty others similar. This bad economic policy in- 
fested Europe and prepared the way for the industrial 
and commercial rivalries from which almost all modern 
wars have arisen. 

Before entering upon an account of these deplorable 
events, it may be proper to point out here one of the 
most curious results that the discovery of the New World 
has given to science. When the Spanish were weary of 
experimenting on the mines, they gave themselves to 
some attempts in agriculture, such as the cultivation of 
sugar-cane and cotton. Then people witnessed the phe- 
nomenon of a population, in command of more land than 
they could cultivate, being obliged to grant very high 
wages to workmen who were themselves in a condition 
to become proprietors and to pay wages, in their turn, to 
other workmen soon rich enough to leave them. The 
liberal reward of labor encouraged marriages, and con- 
tributed to the increase of population. Thus the United 
States have seen, in less than half a century, the number 
of their inhabitants increase from one million two hun- 
dred thousand souls to more than fifteen millions,* while 
the Spanish colonies of South America, devoted to idle- 
ness, and equally the prey of civil and religious corpora- 

* Probably now (1879) not far from fifty millions. — Trans. 



GREAT ERROR OF COLONIAL SYSTEM. 233 

tions, have constantly deteriorated. Even to-day, when 
restored to their independence, they still sadly struggle 
in the swaddling-bands of the past, under the weight of 
the vices and incapacity of their early founders. 

The great error of this system, invented by the Span- 
ish, lay in seeking to isolate from the rest of the world a 
people who had more than three thousand leagues of ac- 
cessible coasts. The Spanish too soon forgot that it was 
in hatred of Venetian monopoly that the Portuguese had 
sought to win a fortune by maritime discoveries, and that 
they themselves supposed they had sent Columbus to th^ 
East Indies, when he discovered the West Indies. The 
common name, applied to colonies so different, testifies 
strongly of the spirit which then animated the voyagers 
from the Iberian peninsula. Why then did they depart 
so positively from the spirit which had made them un- 
dertake so many and so great enterprises ? We have an- 
swered : — the spirit of monopoly, in hatred of which the 
Spaniards discovered America, and which their govern- 
ment established there on bases so odious, was a neces- 
sity of the warlike policy of Charles V. Constantly re- 
duced to expedients, and pressed by want of money, 
that prince saw in America only a mine of gold, and 
worked it without pity because he was without resources. 
All his legislation had for its sole aim to rob the natives 
by means of the colonists, and the colonists by means of 
tariffs. Notwithstanding his great penetration and his 
great experience in affairs, Charles V had never a sus- 
picion of the advantage he might have derived from his 
rich conquest, if he had wisely administered it, instead of 
inconsiderately oppressing it. His successors killed the 
hen with the golden eggs: but he had already opened its 
entrails. 

This bad example, given by the Spanish, was unfortu- 
nately imitated by all the European nations in their rela- 
tions with their colonies. There was not a single one of 
them which dreamed of the immense benefit it might 



234 HISTORY OF POLITICAL ECONOMY. 

have derived from free trade, by putting it under the 
protection of its fllag. Every metropoHs considers itself 
the proprietor of its colony, and the time was at hand 
when the slavery of nation to nation was going to succeed 
personal servitude. Portuguese, French, English, Dutch, 
Swedes and Danes, all yielded to the same prepossession, 
and they have since cruelly expiated it, by their irrepara- 
ble mistakes. Brazil has become independent of Portu- 
gal ; France has lost St. Domingo ; England has been 
driven out from the United States ; Holland is reduced 
to the island of Java, and Spain has now only Cuba and 
the Philippine Islands. It is not that the colonial system 
of these nations was absolutely the same. Some among 
them administered their colonies directly, as Spain and 
Portugal ; others gave up the government of them to 
privileged companies, as did England, France, Holland 
and Denmark. But if there were some differences in the 
methods of proceeding among all these administrations, 
there were none in the idea which directed them. Every- 
where there was a desire to make use of the conquest in 
the Greek and Roman manner ; and, in order to suc- 
ceed, rules, restrictions, prohibitions, and too often cruel 
punishments, were multiplied. The privileged com- 
panies worked their monopolies with the most merciless 
severity. The colonists were obliged to sell them all 
their superabundant products. The monopoly fixed the 
prices at the highest rate when it sold, and at the lowest 
rate when it bought. It was often the interest of the 
company even to depreciate the value of the colonial 
products and to arrest their increase in quantity, so that 
the price could be kept very high in Europe. A passion 
for this desolated a part of both hemispheres, and the 
Dutch in the Moluccas, as we have seen, set fire to plan- 
tations of spice trees, to prevent their rivals from profit- 
ing by them. 

Othernations, without according privileges to exclusive 
companies, restricted colonial commerce to one single 



RESTRICTIONS ON COLONIAL TRADE. 235 

port of the metropolis, from which no ship was permitted 
to set sail, either alone or in convoy, without a special 
authorization, except at a time determined. This circum- 
stance obliged the ship-owners to have an understanding 
with each other, and often to associate themselves to- 
gether, so as not to injure each other by competition : 
and the effect remained the same with regard to the 
colonists, who were always obliged to buy dear and sell 
cheap. The most liberal parent countries sometimes 
modified the form of these regulations, but they never 
ceased to consider the colonies as possessions rightfully 
subject to an exceptional justice. Notwithstanding the 
revolutions which have at various times protested against 
that oppression, all European nations still persist in the 
same system. There is a special legislation for the colo- 
nies in France, in England, in Holland and in Spain. 
What is legitimate in Europe, ceases to be so in Asia^ 
in Africa, in America. Negro slavery has come in, to 
complicate in the New World that regime already stained 
with more than one radical vice. The colonists have 
compensated themselves, at the expense of that unfortu- 
nate race, for the outrages they endured from the high 
and powerful lords of the mother country ; and thus the 
colonial regime has become the school of all the immo- 
ralities with which industrial and commercial civilization 
is still afflicted. 

The fatal principle of monopolies even penetrated es- 
tablishments where the mother country had no right tO' 
exercise sovereignty. In Japan, in China, and at some 
points on the shores of the Mediterranean, where, for 
want of colonies, they were reduced to tolerated trading- 
houses, these latter were secured to privileged companies ; 
and it is only within a few years that the English have 
abolished the monopoly of the India Company for Chi- 
nese trade, which is henceforth open to all British citi- 
zens. It is now beginning to be comprehended that it is 
not necessary to be master of a country in order to estab- 



236 HISTORY OF POLITICAL ECONOMY. 

lish advantageous relations with it. When, after the 
American war, the EngHsh government saw itself forced 
to sign a peace with its emancipated colony, there was a 
general commotion in the ports of England. The city 
of Bristol addressed a petition to parliament, to entreat 
it to refuse its sanction to that fatal peace which would 
bring ruin upon British commerce ; and a few years after 
the signing of the treaty, the same city asked an author- 
ization to excavate new harbors for its ships, the number 
of which had doubled in consequence of its relations with 
the United States. By losing its possessions which had 
revolted, the English nation saved the expense of keep- 
ing and administering them, and its commerce gained in 
extent and importance much more than colonial despot- 
ism could have given it. If Spain had had the good 
judgment to make peace, at a suitable time, with the 
republics of South America, and to profit by the advan- 
tages resulting from the uniformity of the language, 
habits and wants of the two peoples, she would not to- 
day be without resources, and her industries would have 
regained some traces of their former splendor. 

Who cannot now comprehend the diflficulties in gov- 
erning a country two thousand leagues away, with ideas 
in opposition to the character of its inhabitants and with 
the enormous expenses which all distant operations ne- 
cessitate ? The power falls in this case into the hands of 
viceroys, proconsuls, or governors. The government of 
the mother country only sees through their eyes, only 
acts upon their advice, and is too often a dupe of the re- 
ports made to it. " Dependent colonies," says J. B. Say,* 
** have always been as badly settled as badly governed. 
People go to them only with the expectation of return- 
ing ; that is to say, to return to Europe with a fortune 
well or ill acquired." Moreover, see what, after three 
hundred years of domination, was the condition of most 
of the colonies which are to-day at length emancipated ! 

* Cours Complet d'Economie Politique, vol. i, page 629. 



EVILS OF COLONIAL SYSTEM. 237 

They will long bear the scars of the plague-spots which 
the tyranny of their parent-countries brought upon them, 
and the long influence of their fatal principles will blast 
in them for a century to come all attempts at regenera- 
tion. They are under the common law of the individuals, 
fortunate if they have an education, unfortunate if it is 
neglected. Europe has accumulated in these regions of 
privilege all the abuses and all the vices of her worst gov- 
ernments. She has there reorganized slavery on an im- 
mense scale, to such a degree that in several colonies the 
black population has outrun the white aristocracy. St. 
Domingo has given the signal of reaction, which already 
is faintly heard in Louisiana and Brazil, and which the 
abolition of slavery in the English Antilles will inevitably 
precipitate, if the recalcitrant colonists do not finally 
open their eyes. When one hears the revelations * which 
each day brings, of the internal administration of the 
colonies, he ceases to be surprised at the languishing con- 
dition in which they have been, and at the despair which 
has driven them to revolt. Never has appeared a more 
audacious contradiction to the designs of the Creator. 
Never have more brows, bowed to the dust, entreated a 
more jnerited reparation or one more tardy in coming. 

However, the colonial system was maintained in all 
its vigor only as a temporary evil, from which Europe 
was to receive, at a more or less remote future, the most 
brilliant compensation. The privileges of the companies 
were never granted for perpetuity, but only renewed 
either by legislative acts, as in England, or by royal ordi- 
nances, as in other countries. No one could ever at the 
outset have dared to proclaim the perpetuity of a regime 
so monstrous, even though politics and necessity seemed 
to justify its establishment. It was to be, like all mo- 
nopolies, only a temporary measure, indispensable to 
strengthening the rising colonies, and which would right- 

* See work published in 1826, in London, under the title : Noticias Se- 
cretas de America, por don Jorge Juan y don Antonio de Ulloa, in 4to. 



238 HISTORY OF POLITICAL ECONOMY. 

fully cease as soon as they should be well established. 
By degrees, however, the lease having become emphy- 
teutic, ended by taking the character of a perpetual grant ; 
and its duration would never have been interrupted but 
for the intervention of revolutions. It had already been 
very much prolonged at the time of the discovery of the 
special products found or naturalized in the New World, 
such as cochineal, Peruvian-bark, sugar, coffee, cotton, 
cocoa, indigo, dye-woods and the other articles of which 
European nations wished to have their share, even at the 
cost of contrabandage, interloping, and war. Hence arose 
a new system of commercial law, eminently exclusive, 
each wishing to keep for himself the monopoly of the 
products in favor, or to take it forcibly from more fortu- 
nate rivals. Complications were especially manifest when 
most of the European powers had founded settlements 
under the same parallels of latitude, or when they had 
naturalized in them the cultivation of commodities for 
which the demand was great. Sugar was soon exported 
from San Domingo, Jamaica, Cuba, and all the Antilles 
belonging to various masters. Coffee was planted in 
Brazil and Martinique. Cotton enriched the plains of Lou- 
isiana, Georgia, and Carolina. Indigo came at the same 
time from Calcutta, Guatemala and Caraccas. Sugar from 
India competed with that from America, both to-day be- 
ing threatened by that of the beet. The gold was ex- 
hausted ; but there remained in America mines more 
valuable, and these were the only ones which the blind 
parent-countries had not known how to work. 

The great error of Europe lay in seeking profit in 
high prices resulting from the rarity or the monopoly 
of colonial products, rather than in their abundance. 
At the commencement, the first comers attempted to 
prevent their rivals from coming ; they even tried to con- 
ceal the way to the Indies, as misers conceal their trea- 
sure : then, the way being once known, they forbade for- 
eigners to land on their possessions ; and when, in spite of 



RESULTS OF RESTRICTIVE LEGISLATION. 239 

force and threats, they had to resign themselves to hav- 
ing competitors, tariff-wars created distinctions between 
productions from the same soil. Sugar and coffee cost 
more or less according as they were imported by foreign 
or native vessels. A certain American colony near the 
mainland was obliged to have its grain brought from Eu- 
rope, at the risk of dying of starvation in case of delay 
in arrivals. All this absurd legislation is to-day in force,* 
England has strengthened it in her famous navigation act : 
France by all her tariff laws ; Spain by respect for her own 
invention. Lands separated a few hours distance by an 
arm of the sea, are as foreign to one another, under the 
sky of the Antilles, as if the Atlantic Ocean extended 
between them its fifteen hundred leagues of breadth. 
We ourselves sacrifice the general interests of national 
commerce to two or three isles less populous than a single 
one of our departments. The consequences of the sys- 
tem adopted by the founders of the colonies, have, on 
the whole, been only the trade in blacks, tariff-wars, mari- 
time wars, enormous naval expenses, even in times of 
peace, and the necessity of paying dearly for provisions 
which to-day all Europe would have cheap, if it had 
employed in the fertilization of the colonies a tenth part 
of the treasure expended in ruining them. Some day it 
will be difficult for our posterity to believe that this sys- 
tem could have lasted so long, and that the people of 
Europe would have borne such great sacrifices for the 
maintenance of a state of things so opposed to their real 
interests. It has been said in explanation that the ex- 
clusive commerce of the colonies, by preventing compe- 
tition, did not risk being affected by those perturbations 
which more or less menace commerce between indepen- 
dent nations : but besides competition being a real ad- 
vantage, we must consider that monopoly can only be 
maintained in colonies of small extent and easy to guard. 
All the British marine would to-day no longer suffice to 
* See note on chap. xxix. 



240 HISTORY OF POLITICAL ECONOMY. 

protect the coast of the American Union against contra- 
bandage, if this country still belonged to Great Britain, 
and if there were profit in carrying products there. The 
severe regulations of the Spanish government, its cus- 
tom-officers and its coast-guards, have not prevented 
South America from being flooded with European mer- 
chandise. Nor is it true that the mother-countries owe 
to the prohibitory system the regularity of their supplies 
of colonial provisions. Prussia, Austria, Saxony, Switzer- 
land, Bavaria, and all the states which have no trans- 
atlantic colonies, have never lacked for sugar, coffee or 
cotton ; on the contrary, these articles have always been 
cheaper than in the countries with possessions beyond 
the sea. Having no monopoly to support, these states 
choose the places where they can procure for themselves 
the provisions they need, on the most advantageous 
terms, and experience has proven that they have always 
been supplied with them more cheaply than the mari- 
time nations. 

On the whole, the colonial regime has only ended in 
creating between monopolies and their dependencies a 
reciprocity of prejudices and wrongs, and the commerce 
of the colonies has been, on both sides, only a source of 
vexations and impoverishment. With the purest blood 
of their veins have the people of Europe paid for the 
honor of founding settlements in the two Indies. These 
settlements are, in the eyes of attentive observers, only 
like children who have imposed great privations on their 
families up to the time when, arrived at maturity, they 
are in a condition to maintain themselves. Sometimes, 
in that case, gratitude attaches them more strongly to 
the authors of their days : more frequently the latter 
have to complain of their indifference or ingratitude ; but 
it is folly to suppose that independence will not come 
with age, and that after three hundred years of tutelage, 
this age has not arrived for all the colonies. To prolong 
their childhood, is to continue to support people who can 



GOLD AND SILVER NOT THE SOURCES OF WEALTH. 24I 

take care of themselves, or to oppress citizens worthy of 
living free. To-day, when all the chimeras on gold and 
silver have vanished, and when a conspicuous failure has 
discredited the last attempts at working mines in Amer- 
ica, we must seek for wealth from different sources. But, 
before indicating them in detail, we will take a glance 
backward and present a rapid account of the monetary 
revolutions which preceded and which followed the dis- 
covery of the New World. 



CHAPTER XXIV. 

The various Monetary Systems which prevailed in Europe from the ancients 
to the discovery of the mines of the New World. — Economic consequences 
of the discovery of these mines. — General view of the works which have been 
produced on coins. 

The ancients appreciated as well as the moderns the 
true functions of money. Aristotle said of it : " It is an 
intermediary commodity, designed to facilitate an ex- 
change of two other commodities." Xenophon* is not 
less explicit: "In most of the other cities," he says in 
speaking of Athens, " a trader is obliged to take commo- 
dities in return for those he brings, because the money 
used in them has not much credit outside ; with us, on 
the contrary, the foreign merchant has the advantage of 
finding a multitude of objects which are everywhere in 
demand, and, besides, if he does not wish to encumber 
his vessel with merchandise, he takes pay in ready money, 
which of all negotiable articles is the safest and most 
convenient, as it is received in all countries, and besides, 
it always brings back something to its master, when the 
latter judges proper to dispose of it." 

The functions of money have not changed since Xeno- 
phon and Aristotle ; money is still an intermediary com- 
modity designed to facilitate the exchange of other 
commodities. How is it then, that its history, which it 
would seem ought to be very simple, is the most exceed- 
ingly complicated and difficult of all those of which a 
general view constitutes the annals of political economy ? 

* Essay on the Revenue of Attika. 

242 



THE PROPERTIES OF MONEY. 243 

How comes it that all nations have had their particular 
money, instead of entering into an arrangement for the 
selection of a uniform standard ? And, above all^ why- 
does each century offer us the spectacle of a monetary 
revolution, that is to say, of a subversion of the value, 
form, weight and standard of the principal element of 
circulation, the one which should remain the most un- 
changeable of all ? Why, in short, do we see so many 
good coins and so many bad ones appear, by turns, in 
the markets of the world, some of almost pure metal, 
others almost made up of the alloyage ? An exact and 
well-developed answer to all these questions would de- 
mand volumes, and these volumes exist ; I will limit 
myself to indicating some of the most important, not to 
extend the examination of the subject investigated in 
them farther than comports with the limits of this 
history. 

The question of moneys is one of those which the 
moderns have complicated most ; the same confusion 
reigns there as in languages, and for the ingenious sim- 
plicity of the ancients has been substituted contrivances 
so complex, that we have lost the hope of returning to 
it, even though all Europe should make a compact to 
this end. Let us lay down a few principles to guide us 
in this study. The essential property in money is that 
it should retain its value from the . time it is received 
until it is paid out ; otherwise, people, in exchanging 
what they sell for what they buy, would not receive 
a commodity equal in value to that with which they 
parted. Another property of money is, that its value 
is measured, like that of any other object, by the quan- 
tity of things that some one consents to give in ex- 
change; if, for an ounce of gold money, one consents 
to give fifteen times more grain or any other com- 
modity, than he would give for silver money, it is easy 
to see that gold money, of equal weight, is worth fifteen 
times more than silver money. Consequently, we can 



244 HISTORY OF POLITICAL ECONOMY. 

understand the folly of the attempts made at various 
times to alter the coins, that is, to give them perforce a 
value which they did not possess. In proportion as these 
changes were effected, the prices of commodities rose, 
because every one refused to give an equal quantity of 
them for a less value in metal. Moreover, it was neces- 
sary to proclaim a inaxim,um whenever it was desired to 
obtain any results from these grand spoliations. When 
crown pieces containing an ounce of silver were reduced 
to contain only a half ounce, under Louis XIV, they 
could purchase, instead of sixty pounds of wheat, only 
thirty. At all other periods in our history, much be- 
fore and long after Louis XIV, the same causes pro- 
duced the same results. 

The more or less fraudulent manipulations of the coins 
which have been practiced from ancient times down 
to the present, proceed from an error of governments, 
still quite widespread, which has led people to suppose 
that money has a character of fixity which it does not 
possess. People have erroneously imagined that the 
monetary unit, in its character of measure of values, had 
itself an invariable value, and that when one paid at one 
time more, at another less for any commodity, it was 
necessarily the commodity which changed in value, and 
not the money. This error has served as a pretext to the 
cupidity of several . princes, who were imprudently per- 
suaded that it depended only on them to double their 
resources by declaring that one hundred thousand crowns 
were worth six hundred thousand francs, as if they would 
not be punished the very day after their fraud by the in- 
crease in the prices of everything, and by the necessity of 
doubling the taxes to meet it. We must then give up 
the idea of comparing with certainty the value of the in- 
come of any business at times remote from ours with 
that of similar occupations to-day, because it is impos- 
sible to find for the purpose a common measure, like the 
metre for lengths and the litre for capacities. 



ADVANTAGES OF GOLD AND SILVER MONEY. 245 

Many as have been the changes to which money has 
been subjected, all nations have had recourse to it as the 
commodity to effect their exchanges. The Lacedaemo- 
nians had iron money, and the Romans of the early days 
of the republic, money of copper. Shells, nails, cacao 
beans, and pieces of leather, have been, in various coun- 
tries, employed for that purpose ; but, from the most an- 
cient times, gold and silver have enjoyed the almost ex- 
clusive privilege of serving as material for money. The 
unchangeable and homogeneous character of these metals, 
their extreme divisibility, their native purity, equal in all 
places, their resistance to wear by the aid of a few par- 
ticles of alloy, perhaps also their natural beauty, suffi- 
ciently explain the universal " suffrage they have obtained 
at all times and in all countries. Besides, whenever one 
speaks in a general way of money, it is understood that 
it is of gold and silver money ; and the first historic fact 
in which he becomes interested is, to learn what, at dif- 
ferent periods of the world's history, was the quantity of 
these metals in circulation. Who does not comprehend 
the advantage derived from an intermediate agent in ex- 
changes, of so small a volume, everywhere sought for and 
everywhere welcomed, while, with simple barter of com- 
modities, commerce would always have remained in 
its infancy? But it is found that what we would have so 
much interest in knowing, is precisely what we have most 
difficulty in ascertaining. We do not even know to a 
certainty the amount of money at present in circulation 
in our country, although an exact account has been kept 
of all the pieces coined for many years. We are unac- 
quainted with the number and value of those which have 
been melted or exported : we do not know the quantity 
of coins still existing of old mintages. The small copper 
coins, which have survived all recoinages and all reforms, 
also constitute a portion difficult to estimate of our mon- 
etary wealth and of that of other nations. *' I have found 
in our provinces," says J. B. Say, "some of these copper 



246 HISTORY OF POLITICAL ECONOMY. 

pieces which have been in circulation from the time when 
we were under the dominion of the Roman emperors. 
They pass for one Hard, two liards, one sou, two sous, 
with the effigy of those masters of the world." 

The rapid multiplication of bills of exchange, bank- 
notes, paper money having forced currency, and in gen- 
eral that of all commercial effects, has contributed much 
to render more difficult an estimate of the amount of 
money in circulation. But it is not necessary to know 
all the facts, to draw inferences from them of practical 
utility. The essential point is, to know by what signs 
abundance or scarcity of money is manifested, for these 
signs are sometimes very deceptive. Thus, in countries 
where great commercial activity reigns, money is almost 
perpetually in circulation ; and less money than one 
would suppose, is needed for the demands of business ; * 
while in other countries, where money abounds, but where 
there are no transactions, one might suppose money to 
be very rare, because it does not circulate. In proportion 
as the means of the people increase, a portion of the 
precious metals is employed for gold and silver articles, and 
ceases to perform the function of money. In other circum- 
stances, money diminishes in value because of its abun- 
dance, and many mines cease to be worked, until there is 
profit in resuming their exploitation. In the study of 
monetary questions, it is necessary to take into account 
all these variations ; but an exact knowledge of the coin 
possessed by all nations is useless in that solution. 

There is no doubt that in the finest days of the Roman 
empire, when the annual revenue of the state was esti- 
mated at nearly a milliard, there was an enormous mass 
of money in circulation, and yet manufactures did not 
exist. The money came by way of pillage, and was ex- 

* For an account of the London Clearing-House, whereby transactions to 
the amount of many millions daily are settled without the intervention of a 
single bank-note or sovereign, see H. D. Macleod's Principles of Econ. 
Phil., vol. i, chap, vii, § 73. On payment of French indemnity to Ger- 
many, see vol. ii, chap xv, § 12, of the same work. — Trans. 



AT ROME. EFFECTS OF INCREASE OF MONEY. 247 

pended in prodigalities. The little that the Romans ob- 
tained from the mines was due to the labor of slaves, 
as in Greece ; and it does not appear that much impor- 
tance was attached to them, even when their exploitation 
,was farmed out to grantees, and regulated to the profit 
of the emperors. But the increase in the quantity of 
money was already felt in prices, and we have some dif- 
ficulty in comprehending the enormous rate to which a 
great number of articles in general demand had risen at 
Rome even in the time of Cicero. Later, imperial avid- 
ity, breaking all barriers, obliged the citizens to work in 
the mines, as enterprises of public utility, like the corvies 
of the middle ages ; * and this regime was so hard, that 
under the emperor Valens entire legions of miners joined 
the Goths in their invasion into Dacia. Meanwhile, the 
enormous accumulations of capital which the heads of 
the Roman aristocracy enjoyed, were not without influ- 
ence on the magnificent development of the prosperity 
of the empire, and we cannot doubt that most of the 
cities which rose, as if by magic, in all parts of the terri- 
tory, owed their prosperity to that cause. Tiberius f was 
rich enough to distribute to those who had suffered by 
fire the sum of about twenty millions in our money. 
Adrian expended nearly eighty millions in our francs in 
gratuities to secure to Commodus the succession to his 
throne ; and the emperor Severus did not pay less than 
thirty-five millions of francs in liberalities at his acces- 
sion. 

One single circumstance seems to us, however, of a 
nature to shake the faith that has hitherto been given to 
the marvelous tales of the historians who have transmit- 
ted to us accounts of the millions heaped up by the Ro- 
mans ; it is that nothing has been found in the ruins of 
Herculaneum or Pompeii which could justify these exag- 
gerated statements. Almost all the utensils found have 

* Jacob, On Precious Metals, vol. i, page 174. 
\ Suetonius, Life of Tiberius, chap. xx. 



248 HISTORY OF POLITICAL ECONOMY. 

been of iron or bronze, even those we usually make of 
silver; and yet the wealth, and the sumptuousness of the 
paintings, the furniture, and the statues, would sufficient- 
ly demonstrate that we had penetrated into dwellings 
anciently inhabited by opulent families. Could there 
have been such differences between the money and the 
metal employed that people would always convert the 
latter into specie, or must we reduce to more modest 
proportions the metallic wealth of the Romans? It is 
certain that this wealth was very considerable, because 
the transfer of the seat of empire to Constantinople 
sufficed to weaken seriously the riches of the West. 
Capital emigrated in the train of the great families with 
their armies of slaves ; and Italy, which was the garden 
of Rome, beheld her country-houses deserted for the 
ruins of the Bosphorus. Mr. Jacob * has published on 
this subject, a table of the monetary decline of Rome 
from the time of Augustus to near the end of the fifth 
century, from which it would appear that a dimi- 
nution of specie took place from the beginning of the 
Christian era down to the year 482, in the ratio of nine 
milliards to two milliards of francs. The movement 
transferring specie from the West to the East, which 
continues in our day, had just commenced and has never 
been arrested. f 

From the year 482 to the end of the ninth century, the 
specie diminished from two milliards to less than one 
milliard of francs and even to eight hundred and twenty- 
five millions, according to the calculations of Mr. Jacob. 
The appearance of the Mohammedans sufficed to suspend 
all labors in the mines : at the same time, the horrible 
confusion which prevailed in Europe from the time of the 

* In the History of the Precious Metals by the same author, there is a 
price-current list of about four hundred articles of consumption in the reign 
of Diocletian, in 301, prepared by Vescovali and William Banks. This 
document contains details valuable in the study of money and prices. 

f For information on the successive depreciation of money, see the work 
of M. Leber : Essai sur l' appreciation de la fortune privee au moyen dge, 2nd 
edit. 1847. Guillaumin. — Ftench Editor. 



RESULTS OF DECREASE OF MONEY. 249 

invasion of the Barbarians, does not permit us accurately 
to trace further the metallic wealth. Prices become 
lower and lower, either through the influence of servitude, 
which forced to unremunerated labor a multitude of men 
such as are to-day paid wages, or on account of the in- 
creasing scarcity of specie. We hear nothing more of the 
rich and abundant mines which existed in Austria, Hun- 
gary, Bohemia, Saxony, and the Tyrol. Sovereigns 
receive in kind from their vassals the tributes which to- 
day are paid in money. We have seen that Charlemagne 
watched with the most bourgeois solicitude, over the 
administration of his domains, and that the greater part 
of his revenue was composed of the material products 
he obtained from them through his farmers. The mass 
of the people had more limited demands, and the arti- 
cles they bought consisted principally of purchases for 
food. We can readily see that not much gold or silver 
would be needed to pay for a piece of bread which cost 
a liard (less than a farthing — Trans.) or a bunch of 
vegetables, the maximum price of which rarely rose to a 
sou (about a half-penny — Trans.). This explains the 
immense quantity of small change which served for the 
circulation in those little prosperous times : gold and sil- 
ver pieces were very rare, and their value diminished 
from reign to reign until they were as thin as a sheet of 
paper. The happy possessors of those precious metals 
were objects of adulation and envy, as, for example, the 
Jews, whose economic history we have sketched and 
whose persecution we have recounted. Nobles and 
villeins equally solicited their benevolence — the nobles 
especially, who were more eager for pleasures, and who 
purchased the means of procuring them, by all sorts of 
acts of complaisance, and even by presents to the wives of 
these accursed heretics.* 

The precious metals were principally employed in the 
service of the churches, where shone magnificent vessels, 

* Agobardus, De Insolenlia yudcBorum, page 144. 



250 HISTORY OF POLITICAL ECONOMY. 

enormous candelabra, lamps, balustrades and statues, of 
gold and silver. The ornaments of the priests also con- 
sumed considerable quantities, and there really remained 
very little for making and renewing the coins. These 
coins were generally very badly stamped, and one might 
say, to see the progress in goldsmithing contemporary 
with that decline in coinage, that gold and silver were 
only designed to serve for jewelry and in the construc- 
tion of sacred vessels. Saint Eloi is known to have been 
a great goldsmith of the time of king Dagobert, as was 
Alan of Walsingham among the English of the middle 
ages, and the celebrated Benvenuto Cellini in Italy, in a 
century nearer ours. When Richard was prisoner in 
Germany,* Saint Louis in Egypt, and King John in Eng- 
land, f their ransom could be effected only by bringing 
into requisition the plate and jewels of the nobles and 
the churches. The historians of the Saxon period, in 
England, often speak of a living money ^ which was author- 
ized by law, and which consisted in paying for every kind 
of commodities in slaves and in cattle. Later, as money 
again appeared, living money was no longer allowed, ex- 
cept by special contract ; and in this case, horses, cattle, 
cows, sheep and slaves could only be given in payment 
according to an agreed valuation. The fines imposed 
by the state or the church were alone excepted and 
payable, at will, either in coin or in living beings. We 
must, however, do this justice to the church, that, to dis- 
courage the trade in slaves, she finally refused to accept 

* Historians estimate the ransom of Richard at five millions in our francs. 
Almost all the metallic riches of the barons and the churches were employed 
for it. 

\ The ransom of king John was fixed at more than thirty millions of 
francs in our money. The first fifth was paid down, which appeared so 
enormous that it would have been impossible to meet it, if recourse had not 
been had to the Jews, accompanied by the assurance that privileges would 
be granted them. The successor to King John was so poor that he was 
obliged to pay the expenses of his household in money of lead lightly plated 
with silver. The times of the payment of John's ransom were successively 
postponed, and France still owed the last fifth forty years after the treaty, 
when a new war with England broke out. 



LIVING MONEY. APPRECIATED MONEY. 2$ I 

any in payment. Doctor Henry has left us a history of 
England in which are found several curious estimates of 
prices in our money, corresponding to the living money. 
According to his calculations, the fine of a slave would 
have been in the year 997, about 70 francs ; of a horse, 
45 francs ; of a cow, 8 francs ; of a sheep, one franc, fifty 
centimes. We know, by the accounts which have been 
preserved in the Strasbourg cathedral, that the daily 
wages of the masons employed in the construction of 
that edifice were from three to four* centimes in our 
money. 

In the reign of Charlemagne, the silver pound was 
composed of twelve ounces of metal : it was divided into 
twenty soiis, each of twelve deniers, and the denier corre- 
sponded to about six sous in our present money. A four 
pound loaf of bread was sold for less than five centimes, 
which will give a pretty correct idea of the small quantity 
of money then in circulation. By degrees the pound of 
Charlemagne fell from 80 francs to 10 francs, to which it 
had fallen by successive alterations, during the reign of 
King John. But the crusades made a part of the pre- 
cious metals which had taken the route for the East, flow 
back toward the West. The taking of Constantinople by 
the crusaders, gave rise to an immense division of the 
spoils, and Gibbon asserts that the Emperor Alexis paid 
the Marquis of Montserrat the enormous sum of sixteen 
hundred pounds weight in gold. However, there is rea- 
son to believe, that, at the time of the foundation of the 
kingdom of Jerusalem, the revenues of the country were 
insufficient for the maintenance of the government, and 
that Europe was obliged to contribute considerable sums 
every year to provide for it ; which renders very difficult 
an exact estimate of the money in circulation at that 
time. All that we know is, that after the impetus which 
resulted in the great movements of troops and provisions 
to the Holy Land, things resumed their accustomed course, 

* Less than one cent, U. S. money, 



25-'! IIIS'I'ORV ()]'' I'()I,ri'l('Al, lOCONOMY. 

;iii(l the (limimil ion ol spciic ronlimn-d to he fc«lt in all 
1 lie roiiiil lifs ol l'',iii()|)i-. 

riic (iisi'oviMy of the inim-s of the Ncrvv World ahniiilly 
ari(sl(<i this diininut ion. 'V\\c mass of metal which these 
miiu's poured into the eireulat ion, lose in a few yi-ars to 
1 welvi" times thi; amonnt of ail the prin'-xistinL;" money, 
es|)cc'ially after thi' diseover_v of the mines of I'otosi, the 
most prolilie of all, in i^.\'^. 1 nunediat (>ly i)i'iccs rose 
rapidly, and llu- aviM"aL;o prodnct of the mines from 1546 
to lOuij ma)' 111' eslimati'd at more than sixty millions of 
irani's a yCi'ir. l''rom Kkh) to i/oo. this product increased 
to about <'i;;hty millions annually; and from 1750 to 
iSuo tlu; importation of specie from AmericM into Europe 
rey^ularly exceeded the sum of one hundii-d and citjfhty 
millions a year. Hut the increase was h)' f,ir the most 
considerahK- from iStxi to iSio, for it has hc-en estimated, 
from the hesi aul horil ies. at two hundi-ed and fifty mil- 
lions of Irancs. ()uc would suppose, at lust t Iuni<.;ht, that 
suih a rapid increase must havt; produced a correspond- 
in;; rise in jiiices, and suddenl)' chaniunl the C(Mulilion 
and the wattes of labor; hut it was luU so. Tlu^ progress 
in arts A\\i\ mamdactures ci)ntemporary with the dis- 
coxciy oi the mines, necessitated the employment of a 
greater tpiantilN' ol uioneN', and so much tlu- more was 
neeiliHl as its \alue iliminisluul from its \er)' abundance. 
.\ compi'tcM\cy ha\iiu^' become mori> geiuM-al. many per- 
sons w I'le able to coiuert their saxiiu^s into articK^sof 
gold AWil sil\i-r. Ihe llisco\•er^■ o( the Cape ol (uhhI 
Hope, by opening direct communication with the Asiatic 
coutiiUMil. which was ai.\aistoiued to importations o{ gold 
• ind siUer. piewnled the new mouetaiN' re\olution from 
bringing alunil a re.iction in prices that would have be- 
come daiu>eri>us in I'auope but for that diwasion. 

(."ouse(pieut ly, ,is the mass oi mone\- iucreaseil, demand 
for it became mori> keenl\- fidt ; t rans.ict ions which up to 
th.il time had liccw \c\v ilil'ticult or e\iMi impossible, ei 
l>lo\ed a greater quant it}' and prevented its value dimi 



:m- 
min- 



EFFECTS OF DEPRECIATED MONEY ON PRICES. 253 

ishing in the same proportion as its abundance had in- 
creased. Economists are not agreed as to the increase 
in the price of commodities from that fall in the value of 
money. Adam Smith* estimates it as threefold, while 
the Marquis de Garnier rates it at twice as much. By a 
truly remarkable coincidence, at this very time most of 
the sovereigns chose to raise artificially the value of 
coins. Royal edicts had raised, in France, the- nominal 
value of the coined silver mark to 16 and 18 livres instead 
of the 8 to 10 livres at which it was counted in the first 
years of that century. The effect of these two causes, 
which acted simultaneously on the nominal price of all 
provisions for general consumption, produced a rise which 
made them appear ten to twelve times dearer than they 
were previously. People could not explain this commer- 
cial phenomenon, which became the subject of a memorial 
presented to Catherine de Med^cis, and printed at Bor- 
deaux in 1586, under this title : Discourse on the excessive- 
ly high prices, presented to the Queen, motJier of the king, 
by a faithful servant of hers.% The author of this dis- 
course here passes in review, in the greatest detail, the 
prices of different kinds of grain, meats, fruits, vegetables, 
forage and other commodities of daily consumption, the 
rate of salaries, wages, day's-work of mechanics in winter 
and in summer, just as these prices were sixty or seventy 
years before; and he shows that at the time when he 
writes most of these prices have become ten to twelve 
times higher. " As to landed property," he says, " let 
one examine houses, fiefs, seigniories, arable lands, mead- 
ows, vines and other property to which nothing has been 
added for sixty years, and he will find that to-day they 
will sell for six times more than they did formerly.f " 

* Wealth of Nations, Book i, chap. v. 

•^^ Notes de la traduction d'Adain Smith ; by Garnier, vol. v, p. 191. 

f The same lamentations were heard at that time in England. We ob- 
serve in a sermon by Bishop Latimer, in the reign of Edward VI, these 
singular words : " The physician, if the poor man be diseased, he can have 
no help without too much ; and of the lawyer the poor man can get no 



254 HISTORY OF POLITICAL ECONOMY. 

This increase in the price of things manifested itself in 
all the countries of Europe, in proportion as the gold and 
silver of the New World was distributed in them through 
the agency of the Spaniards. We find in the Secret des 
Finances, attributed to Froumenteau, that from the end 
of the reign of Louis XII to the year 1581, when that 
book was printed, that is to say within a period of seventy- 
five years, the public tributes had more than quintupled 
in France : the same increase having been experienced in 
other countries, there was a strong demand for labor to 
provide for them, and it was perhaps as much from this 
cause as in consequence of the development of civilization, 
that prices, momentarily increased, ended by maintaining 
themselves within reasonable limits, notwithstanding the 
artificial increase of the sum total of the money by altera- 
tions, and its real increase by importations. All the habits 
become changed ; bold enterprises are executed, new de- 
mands are created with the possibility of satisfying them ; 
greater means of exchange facilitate commerce and specu- 
lations. If, however, America had not been discovered, 
gold and silver pieces would have been less numerous, 
but they would have had more value ; there would have 
been relations between commodities and money very 

counsell, expedition, nor help in this matter, except he give him too much. 
You landlords, you rent-raisers, I may say yo»* steplords, you unnatural lords, 
you have for your possessions yearly too much. Poor men, which live of 
their labour, cannot, with the sweat of their face, have a living ; all kinds of 
victuals are so clear, pigs, geese, capons, chickens, eggs, etc ! These things 
with others are so unreasonably enhansed ; and I think verily, that if thus 
continued, we shall at length be constrained to Tpscy for a pigge a pound." 

We find the same grievances in the Spanish writers. Father de Sancho, 
author of a work entitled : " Restauracion Politica de Espana," which sums 
up quite well the political economy of those times, thus expresses himself on 
this subject : " Es vei dad, que antes del descubrimiento de las Indias solia 
comprarse por un quarto lo que ahora por seis reales ; valia el cobre tres 
tanto mas que ahora la plata, pues pesaba un quarto lo que ahora un real de 
a dos ; y ansi, mas rico estaba uno con cien reales en quartos que ahora con 
cinco mil. Y con la abondancia de plata y oro ha baxodo su valor, y con- 
seiguientemente ha subido el de lo qua se compra con la moneda ; y asi se 
introducen altos precios en todas las cosas, y faltando la plata y oro, quedan 
los hombles obligados a tan grandes gastos, imposibilitados de alcanzar las 
grandes cantidades que son menester para ellos ; porque antes que hubiese 
tanta plata, un pobre hallaba un quarto en ocho blancas, mas facilmente 
que ahora dos reales en diez y siete quartos," 



EFFECT OF INCREASE OF MONEY ON LABOR. 255 

different from those which exist to-day : more things 
would have been obtained with less money ; but produc- 
tion would have been long in a languishing condition for 
lack of capital, and civilization would have remained 
stationary with production. What proves this is that 
the impetus given to labor by the augmentation of the 
precious metals did not stop at this first step. Soon the 
specie no longer sufificed : bills of exchange, notes of 
banks of deposit and of circulation, and all the institutions 
of public and private credit came in to increase the num- 
ber of means of exchange, and consequently to stimulate 
labor to the highest degree. It is not necessary to con- 
fine ourselves to abstractions : abundance or scarcity of 
money cannot remain an isolated fact ; there is a constant 
tendency towards an equilibrium. When metallic money 
abounded in Spain, it excited there a keen desire to con- 
sume, by affording the citizens of that country the neces- 
sary facilities for procuring in foreign countries whatever 
could gratify their tastes or satisfy their wants. Europe 
began to produce for them, and for nearly a century, they 
alone commanded labor, and were the most powerful pro- 
moters of the industrial arts. Through their hands was 
brought about an immense distribution of wages, and 
mechanics dared to indulge a faint hope of obtaining, by 
means of their pay, something more than the poor bit of 
black bread on which they had hitherto subsisted. 

But such a great change could not be brought about 
without suffering. At first, before the increase of farm- 
rents and salaries had come into harmony with the 
rise in the price of things, it was hard for all those who 
lived on a fixed income or a limited salary. The increase 
of money acted in that case like the invention of a ma- 
chine, which at first causes a withdrawal of a certain num- 
ber of mechanics, until the demand for the products, 
called forth by the lowering of prices, has restored em- 
ployment to them. This explains how it was, that, in- 
stead of rejoicing at a circumstance, which, according to 



256 HISTORY OF POLITICAL ECONOMY. 

the common ideas, was to enrich the whole world, the 
contemporaries were only impressed by the increase in 
prices which rendered life harder for them. We have seen 
the state of opinion in that regard in France, England, 
and Spain ; and a very curious book could be made of all 
the jeremiads inspired by this phenomenon of the rise of 
prices, at which people were the more alarmed because 
they did not all comprehend it.* And in fact it was 
difficult to explain how provisions and other commodities 
could thus have increased in price, since they were neither 
more rare nor more in demand. The same quantity of 
grain exchanged at all times for a cow or a certain num- 
ber of sheep ; but, when it was necessary to measure these 
commodities by means of money, the proportions were 
no longer the same ; the buyer complained of being 
obliged to give more money, forgetting that when he be- 
came seller, he also received more. However, the one 
who produced more than he consumed, saw his profits 
increase when he estimated them in money, while he 
who found himself in the contrary condition, the simple 
consumer, perceived with bitterness his own ruin, in 
the face of an income that was unchanged while prices 
were rising. But as in organized society everybody is a 
producer at the same time and almost in the same pro- 
portions as he is a consumer, the discomfort became daily 
less considerable, and the equilibrium brought about pros- 
perity. Money was not long in diminishing in value while 
increasing in quantity, and the prediction of Bishop 
Latimer that a pig would soon cost more than a guinea, 
was completely fulfilled. There happened in Europe 
what happens in all countries when the influx of specie 
causes enterprises to be undertaken which would not 
have been dreamed of if that influx had not permitted 
them to be executed. 

* The most remarkable of these writings is that which appeared ia 1581, 
during the reign of Elizabeth, under this title : A brief conceipte touching 
the comvioiitvealthe of this realme of England. It has the form of a d ialogue 
in which figure a landed proprietor, a farmer, a merchant, a manufacturer, 
and a theologian. 



PRODUCTION OF THE PRECIOUS METALS. 257 

M. de Humboldt has estimated the product of the mines 
of the New World from the discovery to our time, at the 
enormous sum of thirty milliards of francs. Without con- 
fidently admitting a figure so high, we think that nothing 
less than the fecundity of these mines would have sufficed 
to meet the wants of the circulation, as soon as labor had 
been stimulated in Europe by the importation of the first 
products. The prosperity of England, Holland, Germany, 
France and even Russia must be attributed to the in- 
dustrial impetus which these different countries received 
from the shipments of American bullion in exchange for 
their raw products or their manufactured goods. When 
the war of independence, by suspending the labors in the 
mines of Mexico and Peru, reduced the production of the 
precious metals to a third of what it previously was, Eu- 
rope made up the deficiency by improvements in credit 
and the multiplication of effects of every kind which aim 
to take the place of money or to supplement its services. 
This revolution of an opposite character to that which 
followed the early days of the discovery, is continuing to- 
day,* in consequence of the increasing diminution in the 

* Since the author wrote these lines, important changes have taken place 
in the production of the precious metals. The discovery of gold in Cali- 
fornia in 1848 and in Australia in 185 1, and the consequent extensive mining 
operations, and also the increased working of auriferous deposits in Russia, 
in addition to the silver product of the Mexican and South America mines, 
so augmented the total of the precious m.etals, as to cause a depreciation of 
the value of money in general and especially in the value of gold as 
estimated in silver. Levasseur, {La Question de I'Or, Paris, Guillaumin, 
1858, p. 192, et seq.) estimates that in France, money had in 1856 lost 29 
per cent, or about two-sevenths the value it had in 1847. His estimates are 
based upon the rise in prices of articles of ordinary consumption : and 
making allowance for such other causes as existed, he attributes twenty per 
cent of the depreciation in the value of money to the increased supply of 
the precious metals. 

A. J. Warner {Appreciation of Money, p. 10) says : " The quarter of a 
century from 1848 to 1873 has been pointed out by economists as being the 
period of greatest activity in the production and distribution of wealth of any 
period in the whole history of the world. During these twenty-five years, 
about thirty-six per cent was added to the stock of precious metals in the 
hands of man ; and during tliese same years the trade and commerce of all 
civilized and commercial nations increased at a rate never known before — 
the commerce of the United States and Great Britain being increased by 
from 300 to 400 per cent, and national wealth in a corresponding degree." 



258 HISTORY OF POLITICAL ECONOMY. 

supply of the precious metals. Indeed, if one compares 
the mass of commodities at present in circulation with 
that of twenty years ago, he will see that an increase of 
specie of at least ten per cent would have been necessary 
to maintain the same prices. Far from any such increase, 
specie is diminishing, and the population as well as the 
demand for money is increasing. A sudden and extraor- 
dinary cause has also cooperated since 181 5 to increase 
the demand. The governments which had issued a con- 
siderable quantity of paper money during the long wars 
of the Revolution and the Empire, wished to redeem it 
after the peace. The very American states from which 
Europe derived its specie, have lived mostly by loans 
since that time ; and luxurious habits have become so 
general among us, that quite an important sum of gold 
and silver is employed every year for artistic or for 
household objects; 30,000,000 of francs are thus devoted 

Ernest Seyd {Fall in the Price of Silvei-) estimates the addition to the ex- 
isting stock of money between 1848 and 1875, i.e., in 27 years, at 40 per 
cent. 

Now, (in 1879), the tide is again the other way, and we have been wit- 
nessing for the past five years an appreciation of money similar to that exist- 
ing when Blanqui wrote the above pages. The present universal fall of 
prices as measured in either gold or silver (as exhibited in carefully prepared 
tables of more than forty articles of prime necessity) shows that the increase 
of the world's volume of currency has not kept pace with the increase of 
population and business. This fall in prices — a crucial test of appreciation 
of money — is not confined to America and Europe, though probably greatest 
in the United States, Germany, and England, but extends to India and 
China. J. Hector, Deputy Secretary and Treasurer of the Bank of Bengal, 
in his pamphlet. Currency considered with special refere7tce to the fall of 
Silver and Consequences to India," (Blackwood & Sons, Edinburgh and 
London, 1877), shows by tables of prices of exports from India and of 
prices of food there in five principal cities, that general prices in India 
were lower in 1876 than in 1872, though wages had not moved, either up 
or down. 

The London Economist of Dec. 28th, 1878, says : " It is a fact which 
will scarcely be disputed, that the purchasing power of gold is now consider- 
ably greater than it was in the three years 1872-3-4. The assertion may 
readily be corroborated by an appeal to the market price of commodities 
then and now : and the result, which yields an average fall probably exceed- 
ing twenty per cent,'" etc. 

The causes of the present appreciation of money are principally the Ger- 
man demonetization of silver and the consequent limitation of its coinage in 
the States of the Latin Union and in the United States, and the withdrawal 
of a large amount of paper money from circulation in Germany, France and the 
United States. Diminished production at the mines is another cause. — Trans. 



CREDIT TAKES THE PLACE OF MONEY. 259 

in France, and Humboldt reasonably thinks that we may 
estimate at four times that amount, or 120,000,000, the 
like consumption which takes place in Europe. Mr. 
Huskisson informs us that in the year 1828, the amount 
of the charges in England for assaying was 2,625,000 
francs, which supposes in that country alone, a manufac- 
ture of articles of gold and silver to the value of more 
than 100,000,000 of francs. 

Thus the waves of money which have not ceased to 
flow over Europe since the end of the fifteenth century, 
are beginning to retire. The reaction is doubtless taking 
place slowly, but steadily ; and already the countries most 
advanced in manufactures and commerce are obliged to 
ask of credit what the mines have ceased to furnish to 
supply their needs. Gold and silver tend to play hence- 
forth the part in transactions which reserves do in banks 
of discount. A universal clearing--house will sooner or 
later be established, to settle all accounts by compensa- 
tion in credits, and we shall see realized the utopia of 
Ricardo, that money is in its true condition, when it is in 
the state of paper. Do we not already find proof of it in 
the operations of the banks of France, England, and the 
United States? What an establishment is that which 
carries on operations in discount to the amount of seven 
or eight hundred millions a year, by means of a capital 
stock of one hundred millions in specie, one-fourth of 
which would suffice to meet its demands? MetaUic 
money, as we see, henceforth plays only a secondary part, 
and although it would seem that its value must increase 
by the reduction of the product of the mines and by the 
increase of the demands of trade, paper money tends to 
depreciate it, and to take its place in all the markets of 
of the world. The bill of exchange circulates everywhere 
in preference to coin, because it is more convenient and 
runs fewer risks in circulation. 

This monetary revolution, almost accomplished in Eu- 
rope, will permit no more recurrence of the alterations 



26o HISTORY OF POLITICAL ECONOMY. 

and frauds of which the history of nations presents such 
numerous examples. By experiments and misfortunes, 
people have at last arrived at a comprehension of the ne- 
cessity of an inviolable respect for all the elements which 
concur in the security of the exchanges. Nations and 
kings to-day are cured of the fatal mania of seeking the 
precarious resource of debased coin, a resource always as 
disgraceful as it is sterile. But who can number the mis- 
deeds of this kind of which history is full, since the dis- 
covery of the New World ? They who had no mines, 
imagined they could find the equivalent of them by re- 
ducing the standard or weight of their coins, and the 
false money became to the governments a two-edged 
sword, with which they wounded themselves while at- 
tempting to make use of it against their enemies. Thus 
it was with the Dutch, in their revolution against Spain, 
and with the French, in the seventeenth century, in their 
war against the Spanish. Venice and Florence likewise, 
those opulent republics, did not reject these ignoble 
means of supplementing their revenue ; and one may rank 
among the principal causes of the decline of the Floren- 
tines the habit acquired by their merchants of devoting 
themselves to traffic in specie moneys rather than to the 
cultivation of the arts which had made the fortune of 
their ancestors. The evil was not long in taking deep 
root, and there were not only bad moneys, but innumer- 
able books upon money. This is perhaps the economic 
subject on which most has been written. Every one 
thought he had found the philosopher's stone. Davan- 
zati wrote in 1582: "Gold and silver are instruments 
which make the property of mortals circulate over the 
whole globe, and which may be considered as secondary 
causes of a happy life." Serra published, in 161 3, his 
work entitled : A short treatise on the causes which 
make gold and silver abound in kingdoms, and he de- 
voted himself to proving that in his eyes the only wealth 
was gold and silver. Montanari issued, in 1680, his 



VARIOUS WORKS ON MONEYS. 261 

Treatise on Moneys, in which we find, with the pre- 
possessions of his predecessors in favor of the precious 
metals, very just reflections on the phenomena of circu- 
lation. A century previous, Gaspard Scaruf^, of Reggio, 
had addressed to Count Tassoni a " Discourse on 
Moneys," full of views very broad, and still worthy of 
interest to-day, after the excellent writings which have 
appeared on the subject. It was Scaruffi who first pro- 
posed the gold and the silver mark, adopted since in all 
Europe, to serve as a guaranty in the goldsmith's trade. 
The other Italian writers on political economy, Broggia,* 
Nerijf Carli,:{: Beccaria,§ Vasco,!^ have thrown much light 
on all questions relating to moneys, the whole of which 
the French economists have summed up with more or less 
order and perspicuity. Boutteroue, Leblanc, Abot de 
Bazinghen, Dupre de Saint-Maur, Boizard, and Poulain, 
have left us writings more complete than those of the 
Italians, but in which we do not find the same breadth of 
view and the same originality. In Holland, England, 
and Spain, the question of moneys has given rise to thou- 
sands of books, more or less tinged with the prejudices 
of the times, but which can henceforth have only an im- 
portance arising from curiosity, since modern economists 
have thrown light upon that subject by the most brilliant 
and conscientious labors. 

The foolish attempts, which were repeated for many 
centuries, against the integrity of the monetary system, 
are forever ended. Of all the causes pending before the 
tribunal of science, there is not one that she has judged 
with more experience and maturity, and upon which her 
judgment is more invulnerable. Every one to-day knows 
that the real advantages which Europe has derived from 

* Treatise oit Moneys, 175 1. 

f Observations ojt the Legal Price of Moneys, 1751. 

\ Treatise on Moneys, 1760. 

§ On the Confusion in the Moneys, and the Remedies, 1 762. 

^ Political Essay on Moneys, l']']2. 



262 HISTORY OF POLITICAL ECONOMY. 

the discovery of the mines of the New World, do not 
come exclusively from the abundance of the precious 
metals, but from the cultivation of the commodities for 
consumption, which constitute the basis of our exchanges 
with that country. Gold and silver have disappeared ; 
cotton, sugar and coffee remain. The single discovery 
of the potato was worth more than that of the mines of 
Mexico and Peru. 



CHAPTER XXV. 

Some evil consequences of the discovery of tlae American mines. — The 
first appearance of paupers in England. — Ministry of Sully. — His financial 
reforms. — His erroneous ideas on manufactures and trade. — He is the most 
ardent propagator of the 7?ierca)ttile system. — His proneness to sumptuary 
laws. — His severe attacks on financial abuses. — Definitive results of his ad- 
ministration. 

If, in our examinations, we were limited to the surface 
of things, there would perhaps be reason to deplore the 
discovery of the New World. The great importation of 
specie which resulted from it, seems, in fact, to have only 
served to throw Europe into extreme confusion, and to 
disturb minds as well as all business affairs. Charles V 
and Philip II took advantage of it to satiate their ambi- 
tion, by arousing on every side bloody and ruinous wars ; 
the other princes saw in it only an opportunity to get 
hold of the money of their subjects, in order to fight 
with equal arms against the possessors of the new land 
of promise. Everywhere the money-grasping spirit was 
^wakened at the sight of the masses of gold and silver 
which came to us from America ; and the first result of 
that inundation was to suspend the activity of the people 
and the kings, who ran after the wealth of the mines 
rather than encouraged that which came from labor. 
We have seen the surprise of some and the expedients 
resorted to by others, at the appearance of those uncom- 
prehended phenomena of the sudden rise in the prices 
of things without increase in the rate of wages. In vain 
were new palliatives adopted against the incidents of 
each day ; the evil reappeared under a thousand unfore* 

a6% 



264 HISTORY OF POLITICAL ECONOMY. 

seen forms, continually more threatening and more in- 
curable. Debased coin, increased taxation, exactions of 
every kind, could not bring" relief, and the most frightful 
anarchy for a time came near desolating Europe. 

Let us transport ourselves in thought back to the time 
of our civil wars, under Henry III, when on all sides the 
old Catholicism, shaken to its very foundations, was at- 
tempting to grasp again a power which was about slip- 
ping from its hands. This was the most brilliant period 
of the American mines ; each year gallions were returning 
from Mexico, loaded with heavy piasters ; and neverthe- 
less, poverty was reigning everywhere, in spite of the 
new-born elements of opulence ; and, from one extremity 
to the other, Europe was a prey to discord and misery. 
"The country," exclaimed a contemporary French 
writer,* " is devoured not only by gendartnerie and 
gabelleurs, but every hour soldiers come out of the for- 
tresses, who go forth on marauding expeditions, with so 
great insolence and violence that there is not a village or 
house which, one, two, or three times a week, is not com- 
pelled to deal out portions to satisfy the appetite of this 
rabble ; when the soldier departs, the sergeant enters, and 
the houses are ordinarily so full of gensdannes, soldiers, 
collectors of tallies, gabelleurs, and sergeants, that it is a 
great marvel when an hour of the day passes without a 
visit from such people." 

The same state of things existed in England, Flanders, 
Italy, and Germany. One might say that whole armies 
of soldiers had been thrown upon the public, and that 
the people were condemned to give henceforward their 
sweat and their blood to the last drop to satisfy that 
thirst for gold and silver which was devouring their op- 
pressors. Instead of seconding the natural resources of 
each country, the precious metals served at first only to 
exhaust them, and nearly three centuries of experiments 
and misfortunes were necessary to teach us that their 

* Froumenteau; Le Secret des Finances, edition of 1581. 



MINES. SEIZURE OF CHURCH PROPERTY. 265 

true destination was to support industry rather than war. 
The mines of America were discovered a hundred years 
too soon : they should not have poured their treasures 
into Europe until after the long religious wars from which 
resulted freedom of investigation, order in finance, and 
security for labor. In the hands of a king like Philip II, 
their effect was more murderous than that of powder, 
and it was by them, or because of them, that France, 
Spain and England were so long afflicted. The princes 
who had no mines, sought for their equivalent in the 
purses of their subjects, without suspecting that by thus 
attacking capital as well as income, they were striking 
production at its source and the state at its vitals. More- 
over, when we study the history of these deplorable 
times, we hear only of provinces exhausted, houses de- 
stroyed, and unfortunates wandering about the country. 
When the states of Blois assembled, there was presented 
to them an enumeration of these scenes of despair and 
ruin ; and in all the dioceses, after every recital of the 
losses in money, were named the number of priests mur- 
dered, of monks, soldiers and bourgeois massacred, and 
of girls and women violated, without this supplement to 
the budget of miseries being ever forgotten. 

The most horrible confusion prevailed equally in Eng- 
land ; and the reign of Elizabeth, the results of which 
were to be so glorious for her country, had commenced 
under very lugubrious auspices. Henry VIII had 
seized the property of the churches, under pretext of re- 
lieving his subjects from the weight of taxes, which they 
nevertheless continued to pay. Elizabeth prosecuted 
mendicancy with an inflexible hand, and instead of res- 
toring a few thousand workmen to society, she infested 
England with robbers. Under the reign of Henry VIII, 
according to the testimony of Harrison, more than 72,000 
had already been put to death, and under the reign of 
Elizabeth, there was not a year passed without three or 
four hundred being sent to the gibbet. These unfortu- 



266 HISTORY OF POLITICAL ECONOMY. 

nates, wandering in bands of several hundreds, pillaged 
farms, plundered travelers, and from the depths of the 
forest braved the prosecutions of the government. After 
having tried all kinds of punishments, Elizabeth was 
obliged to put the burden of their support upon the 
parishes, and to create the famous poor-tax, which was 
insuf^cient to maintain them, but not to prevent their 
multiplying. Thus, in Spain, the mines of the New World 
had turned the administration and the people from the 
true paths of wealth, by securing to them, almost with- 
out effort, an income independent of labor : in France, 
they had just forced the king to multiply taxes and ex- 
actions of every kind, in order to sustain himself against 
the competition of the Spanish ; and in England, they 
gave rise to the poor-tax, one of the worst inventions of 
modern times. 

It is not impossible, however, to recognize in the midst 
of this chaos, the dawn of a more prosperous epoch and 
of a more regular order of things. In vain the sovereigns 
tried to retain the gold and the silver, to extort it from 
their subjects, and to favor its importation and forbid its 
exportation ; gold escaped from every pore and went wher- 
ever great transactions, that is to say, great profits,* called 
it. By degrees, too, governments perceived that the col- 
lection of taxes needed, in order to become productive, 
to be subjected to strict rules ; and these rules appeared 
in legislation. The parliament in England and Sully in 
France were the originators of this reform, from which 
financial science was soon to arise, and with it a remedy 
for the bad systems born of contemporary ignorance and 
the incapacity of governments. Here begins a new era 
for political economy, and we see at length a system arise 
from the midst of the frightful anarchy which devastated 
Europe during the long religious wars. 

History has justly recognized in Sully the most com- 

* " Money," says Mengotti, *" is essentially rebellious to the orders of law: 
it comes without being called, it goes without being arrested, deaf to ad* 
vances, insensible to threats, attracted solely by the allurement of profits." 



SULLY'S BUDGET. THE PUBLIC DEBT. 267 

plete personification of this system, which we cannot bet- 
ter make known than by a rapid recital of the principal 
acts of the administration of this celebrated minister. 
They are not all in conformity with true principles, for 
Sully had no fewer prejudices than his contemporaries ; 
but he was the first administrator resolved not to proceed 
at hazard, and his acts are all remarkable for a spirit of 
order and consistency which exercised the greatest influ- 
ence over the political economy of Europe. Hardly was 
he invested with the confidence of Henry IV, when he 
began to study carefully the burdens and the resources 
of France ; and he prepared the first budget which served 
as a basis of public accounts. His investigations revealed 
a debt of about three hundred millions of francs towards 
the end of the year 1595, and he at once unremittingly ap- 
plied himself to the creation of ways and means necessary 
to extinguish it. His principal maxim was, to apply a fixed 
part of the receipts to each part of the expenses, without 
ever permitting it to be diverted to any other use. He put 
a restraint on the collectors of the revenue, who were 
exploiting the country with such audacity, that of the 
150,000,000 of francs demanded of the tax-payers, scarcely 
thirty millions entered the public treasury. The receivers 
were prohibited from seizing, under any pretext, the cat- 
tle and farming implements of cultivators in arrears, and 
the most severe penalties were inflicted on soldiers who 
should annoy a peasant, either during their marches or 
when they had arrived at their quarters, which annoyance 
was, as we have seen, one of the most horrible pests of 
that time. It required no less firmness to repress the 
avidity of the provincial governors, who had pushed li- 
cense so far as to levy contributions on their own account 
and by their authority alone. The duke of Epernon, 
who obtained, by such abusive measures, an income of 
sixty thousand crowns, ventured to resist Sully, who de- 
fended as a soldier his operations in finance.^ 
* Forbonnais, Recherches sur les Jinances. Vol. i, p. 38. 



208 HISTORY OF POLITICAL ECONOMY. 

The courageous minister, after having brought to their 
senses all these plunderers, from high to low, soon com- 
prehended, and he asserted it often, that to enrich a 
prince, it was necessary to enrich his subjects. All his 
efforts were then directed toward the improvement of 
agriculture, which he considered the prime industry of 
the country.* He lavished on it encouragement of every 
sort, and in a few years the lands which had fallen into 
neglect in consequence of the misfortunes of war, had 
been again brought under cultivation. He abolished the 
restrictions most embarrassing to the circulation, and 
he suppressed the little favors of every kind which the 
cleverness of courtiers had obtained from the king. Thus 
the duke of Soissons had procured a grant authorizing 
him to levy a duty of fifteen sous per bale on commodi- 
ties exported from the kingdom. Henry IV supposed he 
had granted a gratuity of a few thousand crowns ; the 
courtier had derived a revenue. from it of three hundred 
thousand francs. Sully caused these usurped revenues 
to be restored to the treasury. Unfortunately, this great 
minister did not, in all his life, comprehend the im- 
portance of manufactures. There was in him at the same 
time a sort of aristocratic aversion to mechanical labor 
and a philosophic indifference to all articles of conve- 
nience and luxury. Sully was a nobleman with a stoic 
soul, a true Roman patrician of the fine days of the re- 
public. We know the long quarrels he had with Henry 
IV on the subject of the plantations of mulberry trees 
encouraged by that prince, which came near embroiling 
him with his minister. Sully shrank from the idea of the 
introduction of silks into France. " What are you do- 
ing," he said,f " by presenting to the people the cultiva- 
tion of silk for an employment ? You make them leave 
a hardy and laborious kind of life, such as that of the 
fields, for another which does not fatigue by any violent 

* " Labourage et pdturage" he said, " sont les deux mamelles de V £tat" 
f Memoires de Sully. Vol. ii, p. 289, edit, in 4to. 



OPPOSITION TO LUXURY. 269 

exercise. It has always been remarked that the best sol- 
diers are always taken from the families of robust la- 
borers and sinewy mechanics : substitute for them these 
men who are only acquainted with a kind of work which 
children can do, you will find them no longer adapted to 
military practice, Avhich the situation of France and her 
political condition make it indispensable for her to pre- 
serve and maintain. At the same time that you will 
enervate the people of the rural districts, who are, in 
every respect, the true props of the state, you will intro- 
duce by those of the city, luxury with all its train, volup- 
tuousness, effeminacy, and idleness, which are not to be 
apprehended for those who have little and who know how 
to content themselves with little. How now ! have we 
not already in France a sufficiently large number of these 
useless citizens, who, under a coat of gold and scarlet, 
hide the manners of women?" A Roman censor could 
not have spoken better ; but a minister of agriculture and 
commerce should have other ideas. 

It was this philosophic prepossession against luxury * 
which inspired in Sully most of the bad regulations which 
his administration imposed on commerce and manufac- 
tures. All consumption of foreign products seemed to 
him a larceny committed against France and an attack 
aimed at her morals ; every exportation of money a calam- 
ity which it was necessary to prevent by energetic mea- 
sures. He was thus led to adopt the first theories of the 
mercantile system, of which we may consider him the 
most ardent propagator. Never had any one displayed 
greater severity toward smugglers, especially toward 
those who exported gold or silver. To confiscation of 
the specie seized, he caused to be added confiscation of 
all the property of the offenders, and the king declared 

* Sully, besides, preached by example : "He ordinarily went clothed in 
grey cloth, with a doublet of satin or taffeta without pinking or embroidery. 
He praised those who dressed in this manner and ridiculed the others, who 
wore, he said, their mills and their woods of full-grown trees upon their 
backs." — P&ejixe, 3d part. 



270 HISTORY OF POLITICAL ECONOMY. 

on oath that he would never grant any pardon for crimes 
of this sort. The money coined by the different princes 
of Europe had been current up to this time, and had 
been employed in France indifferently with the money 
bearing the stamp of the sovereign : people were now 
forbidden to make use of any of it, except that of Spain, 
the employment of which was too general to be suddenly 
suppressed. But this prohibition was a fatal blow to 
commerce, and restricted the circulation of capital, be- 
cause people preferred to keep the proscribed specie 
rather than carry it to the mint, where enormous seign- 
iorage duties awaited it. Sully thought he could enforce 
this system by sumptuary laws which aimed at the com- 
pulsory reduction of all public and private expenses, and 
which would, as he thought, bring about wealth and pros- 
perity by privation. " It is still more necessary to do with- 
out the commodities of our neighbors," he said,* " than 
without their money. The necessity people impose on 
themselves of dressing in certain materials rather than oth- 
ers, is only a fault of our fancy ; but the price we pay for 
it is a wrong done to ourselves with full knowledge of the 
case." The silk merchants of Paris having come to pro- 
test to Sully against this course, in the name of the com- 
merce of the city, the minister received them with ill- 
temper, and allowed himself to address to one of them 
outrageous language, which he should not have em- 
ployed.f 

Nor would he ever suppress the custom-house of 
Vienne, better known later under the name of customs oj 

* M^moires. Vol. ii, p. 390. 

f Sire Henriot, charged with the address, having bent his knee before 
commencing. Sully raised him up brusquely, and after having turned him 
around on all sides to contemplate at leisure his dress of the antique style, 
lined with silks of various colors, according to the custom of his call- 
ing, said, " How now, my good fellow, do you come here with your com- 
pany to complain ? Why, you are finer than I ! How is this ? Here is 
taffeta, here is damask, here is brocade ; " and he ridiculed the deputation, 
without hearing it, in so cruel a manner that the confused merchants said, 
on going away : " The valet is harsher and more self-asserting than the 
master. " 



LYONS ASKS FOR FREE TRADE. 2/1 

Valence, the avowed object of which was to render im- 
possible any trade between France and Italy. This fatal 
toll-house established on the Rhone, seemed to have 
made of it an impassable river, and forced the trade to 
take another route, to the great detriment of our inter- 
ests. Forbonnais reports the speech of a deputy from 
Lyons to the states of Dauphiny, in 1600, in which the 
sad consequences of the stubbornness of Sully are ener- 
getically described. " This custom-house," said the de- 
puty, " was established for the reduction of the city of 
Vienne ; and although the city of Lyons had, from the 
beginning, appreciated the danger from it, it hoped that 
as it had been created for urgent and temporary necessi- 
ties, there would be an end to it before there was occa- 
sion to complain. But as things which appear at their 
commencement mild and easy become in time harsh and 
intolerable, this toll has become a reef which cannot be 
encountered without shipwreck. Since the passage of 
the Rhone has been brought into discredit, and the mer- 
chants have preferred to try any other risk rather than 
expose themselves to every sort of injustice, the city of 
Lyons recognizes that from the celebrated and flourishing 
city which it formerly was, it will become a desert, if free- 
dom of trade is not reestablished. All the merchandise 
which came from the Levant to Marseilles and thence to 
Lyons, has already left the old way and sought other 
routes, which, though longer and more difficult, are more 
secure.* Do not think, gentlemen,, that we are so little 
instructed in the science of obedience, the best and most 
fortunate possession of subjects, that we thought of oppos- 
ing the intentions of the king, or of diminishing his rev- 
enues. The taxes from which the people suffer, however 
great they may be, are always accounted holy and just ; 
but they are in the state what sails are to a vessel, to 

* From that time, the trade of Italy with England and Flanders, which 
had been carried on by transit across France, took the sea route, which 
it has never abandoned. 



272 HISTORY OF POLITICAL ECONOMY. 

guide it, secure it, but not to burden and submerge it." 
The historian Mathieu, who has preserved this speech, 
acknowledges that the complaints were general, and that 
they were not regarded. 

Sully, continually misled by the same prepossessions 
which made him dread foreign commerce and internal 
manufactures as causes of impoverishment and ruin, 
imagined he ought to increase the restrictions which 
former kings of France had put on freedom of labor. We 
know that Henry III had ordered, in 1581, that all mer- 
chants, traders, artisans, and mechanics with a trade, re- 
siding in the cities and market-towns of the kingdom, 
should be incorporated, with master and warden, without 
any exception. A second edict, in 1583, had declared a 
permission to work a royal and domanial right : in conse- 
quence, the period of apprenticeship, the form and the 
quality of the masterpieces, the formalities for the recep- 
tion of masters, and all the old legislation of Saint Louis 
had been so reviewed and corrected, that labor had be- 
come a sort of privilege. Sully did not abuse the royal 
and domanial right, but he began to sell letters of mas- 
tership, which exempted the titularies from apprentice- 
ship and tests ; and, creating privileges in the very midst 
of privileges, he did what Saint Louis would not have 
dared to do, notwithstanding the difference of time and 
circumstances. He acted thus from a profound and con- 
scientious conviction, persuaded that manufactures were 
a parasitical branch of production, injurious to agricul- 
ture, and of which he would have said with Xenophon : 
" What shall be done with people, most of them seated 
all the day and bound down to trades whose products 
enervate the consumers and make us spend money?" 

The dominant thought of Sully, in taking all these 
measures, was to supply the wants of the state and to 
have always on hand a considerable quantity of money. 
No opposition seemed to him tolerable, when there was 
danger of being trammeled in the execution of this diffi- 



SULLY'S VAULTS OF MONEY. PUBLIC WORKS. 273 

cult task. Now he replied to recalcitrant parliaments : 
"The king cannot consider unjust what is advisable in 
his affairs : " again, he caused to be constructed in the 
Bastille numerous vaults destined to receive masses of 
money, of which he thus deprived the circulation, but 
which he thought as necessary to the security of the state 
as magazines of powder to its defence. Henry IV sup- 
ported these measures from time to time by studied dis- 
courses, like that in which he explained in a council ex- 
traordinary the motives he had in making a reserve of 
funds to satisfy the exigencies of an unforeseen war or 
guard against the demands of a stormy minority. Sully 
was preoccupied all his life with that financial disquietude, 
to which he more than once sacrificed principles which 
were dear to him ; but his errors were rather those of his 
time than of his judgment, and he was able to say this 
in justification of himself, in his memoirs, that abundance 
began at last to reappear, and that the peasants, delivered 
from all their tyrants in finance, the jiobility and the mili- 
tia, sowed their fields and reaped their harvests in security.'^ 

Then it was that he planned the execution of those 
great works of which the canal of Briare was to be the 
firstj- and which he had so much difficulty in making 
Henry IV understand, little accustomed as he was to an- 
ticipating advantages so far ahead, he who had lived by 
expedients and encroachments on the future. 

Sully himself summed up his economic doctrines in a 

* It was not without difficulty that Sully had succeeded. He himself re- 
lates how every day he had to fight some battle to defend the interests of his 
country. " The king," he says, "had just allowed twenty edicts to be drawn 
from him, and I was setting out to make an attempt with hnn, in favor of 
the people, when I met the marchioness of Verneuil, who asked me what the 
paper was which I held. ' What are you thinking of doing with that ? ' she 
said to me. 'I am thinking, madam, of remonstrating with the king.' 
' And for whom, pray, do you suppose the king would do anything, except 
for those who are his cousins, relatives and mistresses ? ' ' All that you say, 
madam,' I replied, ' would be well if his majesty took the money from his 
purse : but to raise it from tradesmen, artisans, farmers and shepherds, does 
not appear so ; they are the ones that support the king and us all ; it is 
enough for them to have a master, without having so many cousins, relatives, 
and mistresses to support. ' " 



274 HISTORY OF POLITICAL ECONOMY. 

written statement sought from him by that prince, and 
which he has reproduced in his memoirs. " To see if my 
views corresponded with his," he says, " the king desired 
me to give him a memorandum of everything which I 
thought capable of overthrowing a powerful kingdom, 
or merely of dimming its glory. I present it here aa 
a brief of the principles which have served me as a 
rule. ' The causes of the ruin or weakening of mon- 
archies are unreasonable subsidies ; monopolies, principal- 
ly in grain ; neglect of coimnerce, trafific, tillage, the arts 
and trades ; a great number of public offices ; the expen- 
ses of these offices; the excessive authority of those who 
fill them ; the expenses, delays and iniquity in the admin- 
istration of justice; idleness, luxury, and everything which 
has co7inection therewith; debauchery and corruption of 
morals; the confusion of ranks ; variations in the money ; 
unjust and imprudent wars; the despotism of sovereigns ; 
their bhnd attachment to certain persons ; their preposses- 
sion in favor of certain ranks and certain professions ; the 
cupidity of ministers and people in favor ; the degrading 
of people of quality ; contempt and forgetfulness of liter- 
ary people ; toleration of evil practices and the infraction 
of good laws ; and a multiplicity of embarrassing edicts 
and useless regulations.' " Sully was not always consist- 
ent with these doctrines, in all his long administration. 
We find it difficult to reconcile what he said of the im- 
portance of the arts and trades with his efforts to pre- 
vent the establishment of silk manufactures and espe- 
cially with his system oi privations, which naturally closed 
every sort of market for manufactured products. Since 
neglect of commerce and variations in the money seemed 
to him so prejudicial to the general good of the state, he 
ought not to have kept up the custom duty at Vienne 
and disturbed the monetary regime. But his prejudices 
explain his contradictions. He could not make the de- 
velopment of manufactures accord with his horror of 
luxury and with the necessity of providing for the finan- 



LAWYERS. BENEFICES AND REVENUES. 2/5 

cial exigencies of each day. We may say that these two 
feelinsfs were the keenest and most active of his whole 
life. The exactions of lawyers and of the administrators 
of the finances particularly excited his indignation, and his 
ministry was a long combat against their rapacity. The 
truly heroic campaigns he directed against abuses of every 
kind and the boldness of the reforms which the death of 
Henry IV prevented him from carrying into execution, 
are not sufificiently well known. In closing this chapter, 
I will give an idea of them, that one may judge of the 
intellectual movement which was, at that time, already 
taking place in matters of political economy. 

In the ecclesiastical government, lists were to be pre- 
pared of all the benefices with their names and revenues,* 
so as to render an account of the importance of that part 
of the national wealth. Among the nobility, a census 
was made of all the lands and of the revenues they 
brought to the proprietary noblemen ; in the case of the 
commonalty, the necessary precautions were taken to 
avoid the least outrage on the part of the soldiers and the 
nobles toward agriculturists, artisans, and merchants. 
Sully at the same time pursued with his anathemas all 
extravagant expenses. " One may be assured," he said, 
" that if I had been considered, I would have tolerated 
neither carriages nor other inventions of luxury, save on 
conditions which would have cost vanity dear. Special 
regulations should prescribe that the procurers-general 
prosecute and punish as examples those who by the scan- 
dal of a prodigal and dissolute life are prejudicially known 
to the public, to private citizens, or to the procurers them- 
selves. The means given to enable them to do it would 
be to connect with them, in each jurisdiction, three pub- 
lic persons, called censors or reformers, chosen every third 
year in a public assembly, and authorized by their posi- 
tion, with which should be connected all sorts of exemp- 
tions, not only to denounce to the judges all fathers, 

* No beneficiaiy could have more than ten thousand livres of income. 



2'](i HISTORY OF POLITICAL ECONOMY. 

young men with families, and such other persons as are 
accused of carrying a dissolute life beyond the bounds of 
honor, and superfluous expenses beyond their ability, but 
also to oblige the judges themselves, to apply the remedy 
prescribed against excesses of both kinds, prosecuting 
them in case of refusal. Two admonitions should pre- 
cede every criminal prosecution ; but at the third there 
should be entered a sort of action for guardianship, by 
which the bad households would see the management of 
their goods and effects pass into hands which left them 
only just two-thirds, and reserved the other third for the 
payment of their debts. No condition of life should be 
exempt from the requirement, and no citizen should be 
able to avoid that censorship, with any appearance of the 
truth, because it would have itself to respond for its 
actions to a superior tribunal, the ministers of which 
should, as well as this, be kept to their duty by the threat 
of a punishment corresponding to the dishonor. It 
should be decreed at the same time that no person, of 
whatever quality or condition he might be, should borrow 
a sum deemed considerable in proportion to his means, 
nor any other lend it to him, under penalty of losing it, 
without this fact was declared in the contracts or obliga- 
tions in which he pretended to employ that loan. It 
should besides be forbidden, with the same view, to all 
fathers of families, to give to one of their children, in 
establishing him, a sum greater than was just, consider- 
ing their present means and the number of those children 
born or to be born ; excepting the single case which per- 
mitted despised or wounded paternal authority to punish 
a vicious and unnatural child." 

One might think he heard, on reading these lines, a 
Saint-Simonian sermon of our day; and the resemblance 
between the doctrines is still more striking in the threat- 
ening provisions of Sully, to destroy, as he expressed it, 
the contemptible art of chicanery. In law-suits between 
relatives, the plaintiff was held, before everything, to 



ARBITRATION. CANAL OF BRIARE. 2// 

make an offer and even a summons to put all his differ- 
ences to the arbitrament of four persons, chosen among 
the relatives or friends of the parties, two by each : an 
umpire named by the arbiters was to give the casting 
vote. "In regard to judges' fees, salaries, vacations and 
other expenses, as well as all the different subterfuges of 
chicanery, and all the other abuses of the bar in pleas 
and deeds, of which complaints are heard everywhere, the 
king thought he could do no better than to put all these 
details into the charge of twelve men chosen from those 
best informed in affairs, to be discussed and regulated," 
Sully would then have had the civil code drawn up two 
hundred years sooner. Henry IV was so preoccupied 
with the desire for these reforms, that the day when Sully 
sent him the programme of them, made out by his own 
hand, the king had him immediately called, to talk to- 
gether of them, and as soon as he saw him, he cried out, 
" Let my mass be delayed, for I must talk with that 
man, who is not a man for mass." The death of 
Henry IV prevented the execution of these projects, 
most of which were doubtless impracticable, but which 
nevertheless expressed the economic thought of Sully, 
such as we find it in the acts of his administration. The 
principal merit of this great minister was that of having 
reestablished order in the finances and having by that 
means alone facilitated the return, or rather creation, of 
the elements essential to public prosperity. His canal of 
Briare opened the first hydraulic way in France, to which 
he soon added the establishment of public barges on the 
rivers, as he had organized post-houses on the highways 
with relays of horses for travelers. He had found France 
three hundred millions of francs in debt, which would be 
nearly a milliard to-day : he left her entirely free. He 
reduced the taxes, improved the highways, the fortifica- 
tions, the material of war, the public domain, and furnish- 
ed the treasury a reserve in specie of fourteen millions 
deposited in the Bastille. Twelve years had suf^ficed to 



2/8 HISTORY OF POLITICAL ECONOMY. 

bring about these results, which prepared the advent of 
the fine days of the reign of Louis XIV, and which 
definitely installed political economy in the councils of 
kings. 



CHAPTER XXVI. 

The tnfnistry of Colbert and its economic consequences. — Edict and tariff 
of 1664.— Its real aim.— Edict of 1667.— Encouragements to marriage.— 
Fine instructions to ambassadors.— The real doctrines of Colbert.— He is 
erroneously considered the founder of the prohibitory system. 

BETWEEN the administration of Sully and that of Col- 
bert, was that of two priests, Richelieu and Mazarin, both 
wasteful of their means, though from different motives, 
the wholly selfish aims of whom have nothing in com- 
mon with political economy; but there was also the 
reign of EHzabeth in England and the development of 
the commercial power of the Netherlands, magnificent 
episodes in the history of science and of the world. The 
lofty genius of Colbert rises above these two events; 
and the splendor which rendered them conspicuous in 
Europe pales before the recital of the .grand deeds ac- 
complished by the minister of Louis XIV. Colbert was, 
in fact, the only minister who had had a system, settled, 
complete and consistent in all its parts ; and it is to the 
eternal honor of his name that he made it triumph in 
spite of obstacles of every kind. Although this system 
was far from being irreproachable in all its parts, it was 
an immense progress at the time of its appearance ; and 
we have had nothing since then which can be com- 
pared with it, for breadth and penetration. Its organ- 
ization seems to have maintained something of the 
respect connected with religious establishments : it made 
a sect ; and that sect counts to-day perhaps as many 
faithful adherents as the great church which has taken 

379 



28o HISTORY OF POLITICAL ECONOMY. 

for its banner the immortal principle of commercial 
liberty.* 

It was, moreover, the need of restoring order in the 
finances, which gave rise to the attempts at amelioration 
made by Colbert. This illustrious minister soon' com- 
prehended that the surest way to increase public for- 
tune was to favor private fortune, and to open to produc- 
tion the broadest and freest ways. His principal merit 
consists in having brought into perfect harmony all the 
elements which could insure its success. One of the 
first acts of his ministry, the reestablishment of the 
taxes on a uniform basis, is an homage rendered to true 
principles; and one cannot doubt that all the others 
would have been in conformity with this glorious prec- 
edent,, if the science of wealth had been, at that time, 
as advanced as it is to-day. Colbert would certainly 
have carried out in France what Mr. Huskisson had 
begun in England at the time of his sudden death. It 
was he who commenced most of the reforms the com- 
pletion of which is still our aim through difficulties 
which he also created ; for he often gave with one hand 
to withdraw with the other, and he was obliged to make 
more than one concession to the prejudices of his con- 
temporaries and the exigencies of his position. But his 
work remains none the less worthy of our homage, as 
the finest monument raised to science by the hand of 
civil power, and also as a proof of the resources economic 
theories can offer to a statesman. 

Even before his entrance into affairs, the needs of 
manufactures and commerce had already found eloquent 
organs. It may not be amiss to rapidly narrate their 
grievances in order to better appreciate the immensity 
of the task devolving upon Colbert, and his merit in 
accomplish ing it. We have seen that Sully, notwith- 

L'Hisioire de la Vie et de l' Administration de Colbert, by M. Pierre 
Clement, 1846, Paris, Guillaumin, is a work so highly esteemed as to have 
obtamed for its author admission to the Academy of Moral and Political 
Sciences. 



EVILS OF EXCESSIVE TAXATION, 28 1 

standing his sound sense and his force of will, did not 
succeed in destroying a multitude of internal taxes which 
interfered with commerce between the provinces, and 
some of which, like the duty of Valence, had become real 
pests. His successors had increased most of these taxes 
and had created new ones accompanied by the most vex- 
atious formalities and the most odious coercive measures. 
Never was collection more harsh ; it much resembled the 
extortion of oriental tax-gatherers ; and many merchants 
had renounced trade to get rid of it. Others had left 
France; and those who had been able to hold out, ex- 
hausted by the fiscal demands, saw their resources daily 
diminish and their capital encroached upon. Agriculture 
itself, so well protected by Sully, had become greatly dis- 
couraged. Many lands lay uncultivated ; the live-stock 
was neglected, and France was beginning to be covered 
with vagrants and beggars. We find a faithful picture of 
this state of things in the petition presented to the king, 
January 26, 1654, by the six bodies of merchants of the 
city of Paris. " Sire," said the petitioners, " experience 
teaches that excessive taxes have never increased the 
revenues of a state, because they cause a loss on the 
whole of what is gained on the parts. In fact, only com- 
merce and manufactures attract the gold and silver by 
which armies subsist. * * * if our workmen profit 
by their industry, it is not without the help of foreigners, 
who furnish us all the fine wools, for we have only coarse 
ones, as well as the drugs for dyes, the spices, sugars, 
soaps and leathers, which we cannot dispense with and 
which are not found in the kingdom. Foreigners will 
not fail to retaliate, by laying heavy duties on all these 
commodities ; whence it will come to pass that we shall 
obtain no more, or that they will prohibit the admission 
of our manufactured products : consequently our work- 
men will be without employment, and the number of 
useless ones and of beggars will increase." 

Colbert had soon sounded the depth of this evil, and 



282 HISTORY OF POLITICAL ECONOMY., 

the measures he adopted prove that he had at heart its 
removal. The edict of September, 1664, reduced the 
import and export duties on merchandise to suitable 
limits, and suppressed the most onerous. " It is our 
intention," said the king, " to make known to all our 
governors and intendants in what consideration we hold 
at present everything that may concern commerce, and 
why we wish them to employ their authority to have 
justice rendered to the merchants, that they may not be 
diverted from their trade by chicanery. * * * We 
have invited all the merchants by circular letters, to ' 
apply directly to us in all their needs : we have invited 
them to depute some among them to bring us their 
propositions ; and, in case of difificulties, we have ap- 
pointed one person of our suite, to receive their com- 
plaints and to present all their requests: we have 
arranged that there shall always be in connection with 
our suite a commercial house to receive them ; we have 
resolved to use every year a million livres for the re- 
establishment of manufactures and the increase of navi- 
gation ; but as the most solid and most essential means 
for the reestablishment of commerce are the diminution 
and the regulation of the duties which are levied on all 
commodities, we have arranged to reduce all these duties 
to one single import and one export duty, and also to 
diminish these considerably, in order to encourage naviga- 
tion, reestablish the ancient^ manufactures^ banish idleness, 
and, by honest occupations, turn away a great number of 
our subjects from an inclination to a groveling life, under 
appointment to various ofifices without duties, which de- 
generate into a dangerous chicanery infecting and ruining 
most of our provinces." 

At the same time Colbert prohibited the seizure for 
the tallies (villein-tax) of beds, clothes, bread, horses and 
cattle serving for labor ; or the tools by which artisans 

* In 1658, 80 millions of livres worth of French manufactures had been 
exported to England and Holland alone, v. M/moires de Jean de Witt{yoi, 
Vi, p. 182.) 



COUNCIL OF COMMERCE. TARIFF REVISED. 283 

and manual laborers gained their livelihood. The reg- 
ister of the survey of lands was revised, so that property 
should be taxed only in proportion to its value and the 
actual extent of the land. The great highways of the king- 
dom and all the rivers were then guarded by armies of 
receivers of tolls, who stopped merchandise on its paS' 
sage and burdened its transportation with a multitude of 
abusive charges, to say nothing of the delays and exac- 
tions of every kind. An edict was issued ordering the 
investigation of these degrading charges ; and most of 
them were abolished or reduced to just limits. But 
while bringing about these useful reforms in the present, 
Colbert prepared others for the future by instituting a 
council of commerce, the members of which were to give 
an official exposition of the needs of their branch of 
business and of manufacturing industry in general. An 
investigation into the public ofifices sold resulted in the 
discovery that there were then in France more than 
forty-five thousand families employed in services for 
which six thousand would have sufificed. Ah enormous 
amount was thus expended every year to the detriment 
of the working population ; and Colbert mercilessly 
prosecuted its reduction. This minister professed the 
most profound contempt for the class of fund-holders 
and also for that of office-holders, whom he considered; 
as parasites living on the labor of the community at 
large, and he devoted himself to reducing the number of 
the latter, either by abolishing the offices or limiting 
their salaries. 

The lease of customs duties being about to expire, Col- 
bert improved this occasion to revise the tariff ; and al- 
though this fatal measure has since been considered as 
the finest monument of his administration, we think we 
should present it in its true aspect, which seems to us to 
have been invariably misapprehended. Colbert's aim in 
revising the customs was to make them a means of pro- 
tection for national manufactures, in the place of a 



284 HISTORY OF POLITICAL ECONOMY. 

simple financial resource, as they formerly were. Most 
articles of foreign manufacture had duties imposed upon 
them, so as to secure to similar French merchandise the 
home market. At the same time, Colbert spared neither 
sacrifices nor encouragement to give activity to the man- 
ufacturing spirit in our country. He caused the most 
skilful workmen of every kind to come from abroad ; 
and he subjected manufactures to a severe discipline, that 
they should not lose their vigilance, relying on the tariffs. 
Heavy fines were inflicted on the manufacturers of an 
article recognized as inferior in quality to what it should 
be. For the first offence, the products of the delinquents 
were attached to a stake, with a carcan and the name of 
the manufacturer ; in case of a second offence, the manu- 
facturer himself was fastened to it. These draconian 
rigors would have led to results entirely contrary to 
those Colbert expected, if his enlightened solicitude had 
not tempered by other measures what was cruel in them. 
Thus, he appointed inspectors of the manufactures, who 
often directed the workmen into the best way, and 
brought them information of the newest processes, pur- 
chased from foreign manufacturers, or secretly obtained 
at great expense. Colbert was far from attaching to 
the customs the idea of exclusive and blind protection 
that has ever been attributed to them since his ministry. 
He knew very well that these tariffs would engender 
reprisals, and that, while encouraging manufactures, 
they would seriously hinder commerce. Moreover, all 
his efforts tended to weaken their evil effects. His in- 
structions to consuls and ambassadors testify strongly 
to his prepossessions in this regard. He recommended 
to them to smooth over all difficulties which our mer- 
chants might encounter in foreign countries, and to make 
their privileges respected in every possible way. We 
cannot read without admiration the despatches he sent 
to M. de Beziers, ambassador of France at Madrid : " In- 
case the subjects of the king," he said, " receive any bad 



INSTRUCTIONS TO AMBASSADORS. 285 

treatment from the governors or other officers of the 
catholic king, whether in their persons, or in their vessels 
or merchandise, you will make known to the council of 
Spain that His Majesty is resolved not to suffer his sub- 
jects to be molested in any manner, and that we shall be 
able to bring about an abandonment of the practice adopted 
hitherto of not rendering them any justice." We are to- 
day very far from manifesting a spirit so bold. " I pray 
you," he added, " to look into the matter and see if any- 
thing can be done agreeable to the merchants, to facili- 
tate their commerce and to increase it. As the affairs 
which they have in Spain usually remain long undecided, 
for want of being looked after, it is necessary to place 
some person there who has intelligence, and can apply 
himself solely to the support and relief of the mer- 
chants." 

On another occasion he wrote to M. de Pompone, am- 
bassador to Holland : "The maritime commerce of the 
whole world is carried on with about twenty thousand 
ships. In the natural order, every nation should have its 
share in proportion to its power, the number of its 
people and the extent of sea coast ; the Dutch have fif- 
teen or sixteen thousand of this number, and the French 
perhaps five or six hundred at the most. The king em- 
ploys all sorts of means which he thinks to be useful, in 
order to come a little nearer the number that his sub- 
jects ought naturally to have." And in order to succeed, 
Colbert granted prizes for navigation in the Baltic and 
for fishing in distant seas : he suppressed the right of 
aubaine (a prerogative by which the kings of France 
claimed the property of foreigners who died in their 
kingdom, without having been naturalized. — Trans) at 
Marseilles, in order to attract foreigners there ; and soon 
opulent houses from the Levant were established in that 
city, where they constructed a great number of vessels. 
At the same time, the edict of August, 1669, declared 
maritime commerce compatible with nobility, and per- 



286 HISTORY OF POLITICAL ECONOMY. 

mitted any nobleman to be directly or indirectly con- 
cerned in it without derogation. The creation of entre- 
pots served as a compensation for the rigors of the tariffs. 
He gave also all foreign merchandise an opportunity of 
transit through France. His attention extended to 
even the least details for its security. "Take good care," 
he sent word to M. de Sonzy, " to do nothing which can 
interfere with or diminish commerce. You did well to 
have the clerk of the office at Mortagne arrested for re- 
tarding the passage of the charcoal boats ; it is of very 
great consequence that merchants should not be annoyed 
on any pretext whatsoever. Never decide any case with- 
out having heard them. Rather be a little duped by them 
than to embarrass commerce, because this would annihi- 
late products. Nevertheless, always present the strictness 
of the ordinances." 

This is how Colbert understood the administration of 
the customs. We should be very fortunate to-day if it 
were understood in the same manner, in its aim and 
its means of execution. As an instrument of protec- 
tion, he did not separate it from an indefatigable ac- 
tivity in manufactures, and it is easy to see that this 
protection was in his view only a temporary measure, 
such close watch did he keep lest it should degenerate 
into a premium given to carelessness, and into annoy- 
ances prejudicial to commerce. One would say he asked 
pardon of France for it in all the despatches he addressed 
to his ambassadors. He said to his son : " You must 
feel as keenly all the disturbances which occur in com- 
merce and all the losses the merchants experience as if 
they zv ere your own." 

Not content with having established entrepots in the 
ports, he designated them for stopping places for foreign 
merchant-vessels, ordering that any duties they should 
have paid should be refunded to them, when it suited 
their convenience to re-export their merchandise. At 
that time the West India Company found itself no 



LIBERAL TENDENCIES OF COLBERT. 28/ 

longer in a condition to maintain its exclusive privilege. 
The colonies were lacking necessary things, and the low 
price at which their products were taken was driving the 
inhabitants to despair. Colbert decided to render com- 
merce free, and caused an announcement to be made in 
all the ports that every person should henceforth have 
a right to devote himself to it. The more one studies 
the administrative acts of this great minister, the more 
one is convinced of his lofty sense of justice, and of the 
liberal tendencies of his system, which has hitherto been 
generally extolled as hostile to the principle of commer- 
cial liberty. In vain the Italians have hailed it by the 
name of Colbertisin, to designate the exclusive system 
invented by themselves and honored by the Spanish : 
Colbert never approved the sacrifice of the greater part 
his fellow citizens to a few privileged ones, nor the 
creation of endless monopolies* for the profit of certain 

* M. Henri Baudrillart, in his work on Jean Bodin and His Times, a 
representation of the political and economic theories in the \bth century, a 
work which throws much liglit on the beginning of political economy in 
France, has noted the true historical origin of the prohibitory system in our 
country. We read there on page 14 : " The real sponsor of the prohibitory 
system in France was the minister of Charles IX, Rene de Biragues, keeper 
of the Seals in 1571, and Chancellor of France from the death of L'Hopital 
to 1578. He was the first one to lay down as a principle the double prohi- 
bition against exporting from the country materials suitable for manufacture, 
and importing the products of foreign manufactures. We will quote the 
preamble of the edict of January, 1572, on foreign commerce and the regu- 
lation of the kingdom: " In order that our said subjects," we read in the 
the collection of old French laws, vol. xiv, " may better devote themselves 
to manufacture and working in wools, flax, hemp and yarns, which are in- 
creasing and abound in our said kingdoms and countries, and may make and 
realize the profit from them which foreigners do, who come here and buy 
them usually at a low price, transport them and work them up, and after- 
ward bring the cloths and Imens which they sell at a very high price ; we 
have ordered and do order that it shall hereafter be allowable to no one of 
our said subjects and foreigners, for any cause or under any pretext whatso- 
ever, to transport out of our said kingdom and country any wools, flax, hemp 
or yarns. We also very expressly forbid all entrance into this our said king- 
dom of all cloths, linens, gold or silver laces and ribbons, as well as all 
velvets, satins, damasks, taffetas, camlets, linens and all sorts of stuffs 
striped or having in them gold or silver, and likewise all harness for horses, 
belts, swords and dirks, stirrups and gilded, silvered or engraved spurs, 
under penalty of confiscation of said merchandise. * * * Besides, we 
forbid the entrance into our said kingdom and country of any sort of foreign 
tapestries, of whatever material and fashion they may be, under the same pen- 
alties as above." One finds by the side of this, inspired by the same spirit, 



HISTORY OF POLITICAL ECONOMY. 

branches of industry. We may reproach him with hav- 
ing been excessively incHned to make regulations, but 
not with having enfeoffed France to a few spinners of 
wool and cotton. He had himself summed up in a few 
words his system in the memorial he presented to the 
king: "To reduce export duties on provisions and manu- 
factures of the kingdom ; to diminish import duties on 
everything which is of use in manufactures ; and to repel 
the products of foreign manufactures, by raising the 
duties.* " 
I Such was the spirit of his first tariff, published in Sep- 

tember, 1664. He had especially aimed at facilitating 
the supply of raw materials in France, and promoting the 
interests of her home trade by the abolition of provincial 
barriers, and by the establishment of lines of custom- 
houses at the extreme frontiers. The opposition he en- 
\ countered in many localities for a long time paralyzed the 
\ effect of his good intentions ; but with perseverance he 
•1 succeeded in making every part of France share the benefit 
\ of his reforms. The only reproach that can be justly 
made against him is the abuse of the protective instru- 
ment he had just created, by increasing in the tariff of 
1667 the exclusive measures directed against foreign 
manufactures in that of 1664. It was no longer then a 
question of manufactures, but of war, namely, with Hol- 
land; and this war broke out in 1672, after long and una- 
vailing negotiations. The new tariff excluded a quantity 
01 Dutch goods : on her refusal to admit them, France 
immediately saw her own wines, brandies and manufac- 
tured products interdicted. Agriculture, already con- 
demned to hard suffering by the prohibition to export 
grain, one of the errors of Colbert, experienced a severe 
check from the new prohibition, which affected its most 
important products. From the same epoch date the first 

an edict on the manufacture of cloths (March 2d, 1571) and another Qune, 
1572) on the regulation of the rate of interest at six per cent. {J^ote oj 
French Editor.) 

* Forbonnais, Consideraiiotts sttr les finances, vol. ii, page 434. 



FECUNDITY ENCOURAGED. 289 

wars of commercial reprisals between France and Eng- 
land, hostilities which were to cost both nations so much 
blood and so many tears. Manufactures were then seen 
to prosper and agriculture to languish in France, under 
the influence of this system. I know not whether Col- 
bert also feared he would see the population diminish ; 
but he issued in November, 1666, an edict on that sub- 
ject which is hardly in accord with the theories of Mal- 
thus. In virtue of this edict, every head of a family, 
v^ho was the father of ten children, was exempt from 
taxes for the remainder of his life. If he was a noble- 
man, the king granted him a pension of a thousand 
francs, and two thousand francs, if he had twelve chil- 
dren. The favor of exemption from taxes for five years 
was extended to young people who married at twenty 
years; and by way of compensation, a tax was levied 
upon male celibates of twenty years, even under the 
paternal roof. At the same time, Colbert endeavored to 
put a limit to the development of religious communities ; 
private citizens were forbidden to bequeathe to them, or 
to sell by a sinking fund their inheritances or any kind 
of property whatsoever. But all these combined were 
not effective. The measures by which Colbert opened 
new sources of wealth in the country, were worth more 
than his premiums of encouragement to the fecundity of 
noblemen, for he was obliged to renounce the latter in 
1683, after they had engendered more abuses than citizens. 
The treaty of Nimeguen forced France to renounce the 
system of exclusions organized by Colbert against foreign 
manufactures. Each day, each event, thus brought about 
a modification of what was too absolute in the ideas of 
this minister ; but his prohibitory doctrines had been 
given to a land where they were to be religiously kept 
under the auspices of personal interest. The French 
manufacturers became accustomed to consider as a right 
the protection which had been accorded them as a favor; 
and that which, in Colbert's mind, was to be only tempo- 



290 HISTORY OF POLITICAL ECONOMY. 

rary, became in their eyes final. The prodigious indus- 
trial development which followed his system, the regula- 
tions promulgated to sustain it, and the renown of its au- 
thor, all contributed to propagate the fatal doctrine of 
the natural hostility of manufacturing nations. Hence 
have arisen those expressions now proverbial, though de- 
void of sense, of the danger of becoming tributary to for- 
eigners, of letting our market be invaded by foreign com- 
modities, of allowing our gold to be ravished from jis, and 
a thousand others similar, as if all buyers were not tribu- 
tary to sellers, and the latter in their turn, to buyers ; as 
if, in short, a people would not receive in exchange for 
their commodities the commodities of their neighbors, 
unless they gave them gold. If it were so, there would 
be no more commerce ; for what trade could there be, 
where one was willing neither to let gold be exported, 
nor commodities imported ? Europe will have to suffer a 
long time from this prejudice, which has given birth to 
so many wars, and which has thrown all nations into the 
dangerous way of having privileged branches of industry. 
No, Colbert was not to blame for it, and it is in vain that 
some honor his memory and others reproach it, on this 
ground : Colbert was a man of exalted probity, an enemy 
of all monopolies, and the sternest adversary to privileges 
of every kind. Never would this minister, who already 
dreamed of a just distribution of taxes, and who knew 
how to tell his master stern truths, have organized from 
bottom to top the bad system which some have wished to 
baptize with his name. 

We only mention as a memorial the great works he 
caused to be constructed to increase the viability of 
France, and the Languedoc canal, that fine imitation of 
the canal of Briare, which so far distanced its model. It 
is for us to make known the dominant thought of Colbert, 
and not the details of his works ; and a simple narration 
of his economic labors ought to be sufficient to reveal it. 
During his whole ministry, Colbert committed no other 
errors than those which were imposed upon him, or that 



COLBERT'S TARIFFS NOT PROHIBITIVE. 29I 

an exaggerated sentiment of love for his country inspired 
in him in some rare instances. Such were the high duties 
he estabHshed in his tariff of 1667, with the intention of 
securing to France the production of such articles as she 
obtained from abroad ; and yet, need we say, this tariff 
contained no absolute prohibition. Colbert had wisely 
judged that the prohibition to import was sufficiently 
represented by the customs, especially when they rise to 
a certain rate. Then, if manufacturers do not know how 
or will not, with the high premium which the tariff accords 
them, gratify the taste of consumers, the latter have still 
the choice of foreign manufactures, by paying a voluntary 
tribute from which the state profits, for rejection of home 
products. This restricted liberty awakens an industrial 
emulation between different nations, which, on the con- 
trary, national monopoly stifles.* Colbert certainly was 
far from supposing that, at some future day, after French 
industry had taken its rank in Europe, his tariff would be 
judged insufficient and be guarded by prohibitions which 
he had not found necessary for its protection, when it 
was only just adopted. It was reserved for our epoch, so 
justly proud of the progress of its manufactures, to demand 
at the same time medals to reward them and prohibitions 
to sustain them. We should be fortunate, in this respect, 
to go back to Colbert and to return to his tariffs ; more 
fortunate still, if our ambassadors sometimes received 
some such famous instructions as he sent to M. de Beziers 
and to M. de Pompone ! Let people then cease to claim 
the sanction of Colbert's name for the numerous monop- 
olies with which France is to-day beset. These monopo- 
lies are the work of the unhappy times through which 
the present generation has passed : they are all subse- 
quent to the treaty of 1786, and the issue of the great 
wars of the revolution and of the empire. Reestablished 
as instruments of hatred and of extermination, they 
ought not to have survived the war : we hope they will 
not survive peace. 

* M. Bailly, Hisioire financihe'de la France. Vol. i, p. 454. 



CHAPTER XXVII. 

Political economy under Louis XIV. — Commercial ordinances. — Naviga- 
tion. — Streams and forests. — Black code. — Councils of prud'hommes. — ■ 
Poor-laws. — Creation of foundling-hospitals. — Creation of commercial com- 
panies. — Opinions of contemporaiy economists : Vauban, Boisguilbert, the 
Abbe of Saint-Pierre. 

If, as one of our statesmen * lately wrote, " Laws are 
always the monuments the most important and the most 
instructive to the historian," there is no legislation of 
more interest to the political economist than that of the 
reign of Louis XIV. We have already made known the 
dominant thought of the great minister to whom this 
reign owed so much of its renown ; it is time to point 
out the acts which were its expression, which together 
compose the finest structure which has been raised by 
any government to economic science. Alone, in the 
midst of the ruins of the past, this edifice remains ; and 
vit still towers in all its height above our institutions, 
which have not lost, notwithstanding the shock of revo- 
lutions, the impress of its imposing originality. To Col- 
bert belongs the honor of having given a dowry to France, 
by being the first to comprehend, in their full extent, the 
resources of production. Sully had wished to keep France 
within the narrow limits of an exclusively agricultural and 
patriarchal system ; he had opposed with all his power 
the development of manufactures, and he had seen in 
commerce only a dangerous opportunity for the exporta- 
tion of specie. His severe economic policy had been 

* M. Thiers, Law, Encyclop^die Progressive. 

292 



MATERIAL PROGRESS. THE POOR. 293 

continued under the reign of Louis XIII, by sumptuary- 
laws and ordinances, of a character hostile to progress in 
wealth. Colbert opened a career for national labor in a 
regular and judicious manner ; and we cannot question 
that his legislation preceded by a century at least the 
theories of modern political economy. Through him, 
France enlarged her borders and was brought into rela- 
tion with the world ; she ceased to be exclusively agri- 
cultural, and became enriched at the same time by the 
new value given to her territory and to her inhabitants. 

This epoch will forever remain celebrated in the annals 
of science, because it demonstrated the intimate union 
between material and social progress. How many kinds 
of commercial stocks owe their existence to those fine 
ordinances on navigation, on trade, on manufactures, of 
which Colbert was the dispenser and the organ ! When 
we study them attentively, it is easy to recognize that 
they created a formidable rivalry to the landed aristoc- 
racy, by giving to all citizens an opportunity to rise to 
fortune by the influence of labor alone. The forces of 
the nation were thereby doubled, and Louis XIV was 
able, during his long reign, to raise our country to the 
first rank of powers ; happy if he had not abused the im- 
mense resources accumulated by his minister ! Our time, 
so fertile in hazardous attempts, has nothing which can 
be compared to the boldness of the creations of that 
epoch ; one would say that they were all cast at a single 
heat, with so much judgment were they arranged and di- 
rected towards the same end. 

The condition of the poor first attracted the atten- 
tion of the government. While in England they were 
scourged and mutilated under the draconic laws of Henry 
VIII, Colbert caused an edict to be issued for the 
establishment of a house of refuge at Paris, where the 
needy should be received " as living members of Jesus 
Christ, and not as useless members of the state." * An- 

* Edict of April, 1656, in the Collection of Isambert. Vol. xvii, p. 326. 



294 HISTORY OF POLITICAL ECONOMY. 

other edict in June, 1662, ordains that a hospital be 
founded in every city and market-town of the kingdom 
for the invalid poor, the mendicants and orphans, "who 
shall be instructed in the trades for which they are ca- 
pable of being qualified." Premiums of encouragement 
are offered to men who will marry orphans of the asylum 
of mercy ; the king orders that, in this case, they be 
granted the mastership without expense. The ordinances 
issued during his reign testify to the constant efforts of 
this prince to extirpate from his states the pest of men- 
dicancy, a grave question in every age, and one which 
ours has as yet been able to resolve only by imprison- 
ments and prosecutions. At the same time, the solici- 
tude of the government was establishing the first houses 
for foundlings,* houses which have since then become 
more fatal to children than would be utter abandonment ; 
and our progress is still limited to counting the victims.f 
I have told what Colbert had done for manufactures. 
He carried too far his mania for making regulations, and 
we to-day can scarcely comprehend that excess of penal- 
ties for errors in chemistry or mechanics, as if they were 
crimes against morals. However, such rigor was perhaps 
necessary to success in the industrial arts, as strict rules 
are to rising communities ; and Colbert compensated for 
it by so many benefits that one can hardly reproach him 

* Edict of June, 1670. 

A foundling hospital was established at Paris in 1462, and it is probable 
that they existed in the sixth century. Mention is made of them in the 
capitularies of the Prankish kings. One is known to have been established 
at Milan in 7S7 ; at Montpellier, in 1070; at Eimbeck, in 1200: at Rome, 
in 1212 : at Florence, in 1317, and in Nuremberg, in 1331. — {Trans?) 

f MacCulloch states that in the foundling hospital, at Dublin, of 12,786 
abandoned children, 12,561 died in less than six years, from 1791 to 1797. — 
{Polit. Econ. p. 22,2.) {Author's note.) 

The official report of M. Gasparin, at Paris, in 1837, showed that the in- 
fant mortality was appalling there, and that those who survived, constituted 
a large proportion of the thieves and prostitutes of the country. 

An official report made to the prefect of the Seine in 1857, says : " Of 
3,507 infants born and admitted in 1844, 2,659 '^^isd before their twelfth 
year, a ratio of 75.81 per cent. Also, of 3,573 infants born and admitted 
in 1845, 3,700 had died at the end of twelve years, or 75.77 per cent.— 
{Tmfis.) 



FRENCH INDUSTRIES. AGRICULTURE. 295 

with it. It seemed to him that discipHne in the work- 
shops was the surest means of defending them against the 
perils of foreign competition ; and he inflexibly adhered 
to this position. Consequently, French products acquired 
a good reputation throughout Europe, and their supe- 
riority was soon established in the markets of the world. 
By its masterpieces, French industry began the brilliant 
career which it has continued to pursue, and we still live 
by the glorious traditions of its illustrious founder. 
Throughout the country, a peculiar and lofty impetus 
controlled the movements of production, which were 
disciplined like an army ; and if sometimes individual 
genius encountered obstacles in the strict conformity of 
the rules, the mass of the laborers gained much by their 
promulgation. 

Besides, everything was consistent in the general views 
of Colbert. His genius protected with a common solici- 
tude the interests of agriculture, of manufactures, and of 
commerce. There lies his true glory ; and while we still 
discourse on the relative importance of these three ele- 
ments of public prosperity, he encouraged with equal ar- 
dor all the branches. The declaration of January 25, 1671, 
forbade the seizure of the cattle of the farmers,* as 
Sully had interdicted the seizure of implements. The 
ordinance of July, 1656, prescribed the drainage of the 
marshes. A decree of the council, of the 17th of Octo- 
ber, 1665, favoring the reestablishment of the studs, laid 
the foundations of that entirely agricultural institution, 
from which we should long since have derived good re- 
sults, if all the administrations had been actuated by the 
spirit of its author. Finally, the grand edict on the 
waters and forests, which cost Colbert eight years of 
labor, became the basis of our forest code. But it was 
not sufificient to remove the natural difficulties in the way 
of agricultural production ; of what advantage would this 

* " He did not wish," says Necker, " that misfortune should be punished 
by lack of power to repair it." 



296 HISTORY OF POLITICAL ECONOMY. 

new fertility have been, deprived of markets for the sale 
of the products ? 

Colbert had thought of the importance of the roads, 
and he had them repaired with all the luxury of resources 
which the fortune of France permitted. The opening of 
the canal between the two seas, the project of the canal 
of Bourgogne, and all those bold lines, so understand- 
ingly traced since on the map of our country, are striking 
testimonials of his solicitude in that regard. His prede- 
cessors seemed to have thought only of isolating the 
French provinces from each other, and France from the 
rest of Europe ; Colbert's system was, to break down 
barriers and to multiply transactions. In manufactures, 
he created the councils oi prud' homines ; ^ in commerce, 
he published in succession his declaration f on the draw- 
tng and negotiation of bills of exchange^ and his immor- 
tal ordinance of March, 1673, our first commercial code; 
but navigation especially owes him the most eminent 
services. Before the navigation ordinance,\ which for 

*«.<?., "Mixed councils of master tradesmen and workmen for the de- 
cision of disputes between persons of both these classes." — .S^. and Sur, 
Fr. Die. 

f August, 1669. 

:j: January gth, 1664. I will simply quote the preamble of this ordinance, 
to give an idea of the broad and independent manner in which Colbert look- 
ed at all questions : 

" Louis, etc. After the various ordinances which we have made to regu- 
late by good laws the administration of justice and of our finances, and 
after the glorious peace with which it has pleased God to crown our late vic- 
tories, we have thought that, to complete the happiness of our subjects, 
nothing more remained except to procure abundance for them by facilitating 
and increasing commerce, which is one of the principal sources of the hap- 
piness of nations ; and as that which is carried on by us is the more con- 
siderable, we have taken pains to enrich the coasts which surround our 
states, with a number of harbors and vessels, for the security and conve- 
nience of navigators who now land in all the ports of our kingdom ; but, be- 
cause it is not less necessary to strengthen commerce by good laws, than to 
render it free and convenient by the excellence of the ports and by force of 
arms, and because our ordinances, those of our predecessors, and the Roman 
law, contain but very few provisions for the decision of the differences which 
arise between merchants and seafaring people, we have judged that to leave 
nothing to be desired for the good of navigation and commerce, it was 
important to fix the hitherto uncertain jurisprudence of maritime contracts, 
to regulate the jurisdiction of the officers of the admiralty, and the principal 
duties of seafaring men, and to establish a good police in the ports, coast3 



INDIA COMPANIES. COLONIES. REFORMS. 297 

the first time settled definitely its essential rules, there 
was scarcely any maritime commerce in France. Colbert 
alone gave it impetus and life. The East and West India 
Companies, worthy rivals of the Hanse towns, were estab- 
lished under his auspices. A colony, a part of La Ro- 
chelle, went to people Cayenne ; another took possession 
of Canada, and laid the foundations of Quebec ; a third 
became established in Madagascar. The commerce of 
the Levant received new life, that of the north was open- 
ed, and that of the colonies extended. The Senegal 
Company, first organized as a monopoly, soon beheld its 
commerce become public property ; and the Black Code * 
was the first constitutional charter of that unfortunate 
race which enlightened Europe was one day to set free. 

We know not which most to admire, the ensemble of that 
vast economic legislation, or the purity of the considera- 
tions on which its decrees were based. Colbert took care 
to surround himself with all the men versed in the mat- 
ters to which his vigorous hand was going to bring re- 
form ; he questioned them, listened to their objections, 
and very often modified his opinions by theirs. He caused 
a nursery of trees to be planted in the faubourg of 
Roulers, and established barges on the Seine. He created 
the receiving-house (petite poste)f and perfected the gen- 
eral post-office ; he deepened the channel of the Marne, 
and he made of Dunkirk a free port. Regulations, edicts, 
declarations, letters-patent, and ordinances, had, in less 
than twenty years, furnished a solution to all the difficul- 
ties raised by commerce in grain, wine, tobacco, and the 
precious metals. We might say that France had not yet 
known herself and that the minister of Louis XIV re- 
vealed her to herself, so many important works arose in her 
midst, and so numerous were the fleets which set sail from 

and roadsteads which are within the extent of our dominion. For these 
reasons," etc. 

* March, 1685. 

f May, 1653. 



298 HISTORY OF POLITICAL ECONOMY. 

her ports. Although the great Colbert never had occasion 
to formulate his ideas into a system,* and to publish what 
in our day is called a programme, it is easy to recognize 
in him one of the most resolute innovators of which 
history makes mention. Born from the working class, 
and having attained by merit alone the highest of honors, 
he never ceased to work for the amelioration of the 
fate of the greater number ; and the testimony of con- 
temporary writers confirms the opposition he coura- 
geously made to the prodigality of Louis XlV.f France 
had become so beautiful, before this prince had con- 
sumed all the resources with which Colbert had enriched 
her ! Never had it been more clearly recognized what 
the genius of a great people can do, when it is governed 
by men worthy of comprehending and directing it. 

Moreover, even after the reverses which followed the 
old age of the king, even after the revocation of the Edict 
of' Nantes, France did not descend irretrievably from the 
elevated position which she had attained. That was 
doubtless a dreadful blow to her which took away five 
hundred thousand of her most industrious children, for 
that cruel loss has never been repaired ; but the habits of 
order and of labor with which they were imbued spread 
throughout all Europe, and thus the great renovation 
wrought by Colbert ceased to have the narrow character 
of nationality which perhaps it would have otherwise 
maintained. Every nation had a share in the benefits of 

* See Forbonnais, Consid&atiofis sur les finances de France. Vol. i, p. 
271. 

f Colbert expressed himself in strong terms about it to the king himself, 
in a memorial from which I extract the following : 

" In regard to the expense, although that is no affair of mine, I simply 
entreat your majesty to permit me to say that, in war and in peace, your ma- 
jesty has never consulted his finances to determine his expenses, which is so 
extraordinary that assuredly there is no precedent for it : and if he would be 
so kind as to have the present times and past years compared, for the twenty- 
five years that I have had the honor of serving him, he would find that, al- 
though the receipts have greatly increased, the expenses have far exceeded 
the receipts : and perhaps that would convince your majesty to become more 
moderate and retrench the excess, and by this means bring about a little 
better ratio between the receipts and the expenditures." 



PROHIBITION. MOVEMENTS OF SPECIE. 299 

that statesman : Germany, England, Switzerland and Hol- 
land received with our exiles the heritage of our manu- 
factures, and unfortunately that of the exclusive ideas 
which had prevailed at their establishment. No one sus- 
pected that Colbert had only meant to grant to manu- 
factures a provisional protection, to give them time to 
grow and become consolidated. People sought progress 
by prohibition, while he desired it by competition ; and 
prohibition continues still, under forms more or less re- 
strictive, because it is easier to exclude rivals than to sur- 
pass them. That is how the system of Colbert became 
European ; but it was fatal to France only because it ex- 
posed her to the reprisals of her neighbors, at the very 
time when the revocation of the Edict of Nantes left our 
industry disarmed. Colbert had sown : foreigners reaped. 
We cannot attach too much importance to the study 
of these facts, without which the history of political econ. 
omy under Louis XIV would be inexplicable. Colbert 
himself was more than once reduced to undoing his own 
work by the misfortune of the times and the necessity 
of meeting the exigencies of events. Money, which his. 
tariffs had aimed to retain in France, went out in millions 
during the long persecutions of the protestants, and with 
the latter also went most of our arts, of which they carried 
the secrets abroad. We thus lost at the same time an 
immense amount of capital,* and the manufactures which 
could indemnify us for its loss. From these calamitous, 
times dates the origin of the most brilliant foreign manu- 
factures and that thirst for monopolies which character- 
izes the mercantile system. There was a brief period 
when no books were written except those to demonstrate 
the advantage of monopolizing money and the danger 
from allowing it to be exported. The Dutch, too, when 
they had become manufacturers, ardently proclaimed the 
regime of prohibition, and contemporary writers in Great 

* Macpherson {Annals of Commerce, vol. ii, p. 617) estimates at nearly 
one hundred millions of francs the metallic wealth imported into England 
by the refugees. 



300 HISTORY OF POLITICAL ECONOMY. 

Britain speak only of the disadvantages of exchange, 
whenever, in their country, it involved exportations of 
specie. " The surest means of enriching the nation," 
wrote Thomas Mun,* " is to sell every year to foreigners 
more commodities than we consume of theirs," Charles 
Davenant, Sir Joshua Child and Sir James Steuart, his 
fellow countrymen. Melon and Forbonnais in France, 
Genovesi and his school in Italy, and Ustariz in Spain, 
have maintained the same opinion ; and it is not surpris- 
ing that all Europe has sanctioned prejudices stamped 
with a certain color of patriotism. 

From the first, however, the irresistible power of prin- 
ciples modified that exclusive tendency of governments 
in reference to manufactures. Almost all the ruling 
powers tempered, by commercial treaties, that is to say, 
by a virtual concession of privileges, the rigor of the new 
tariffs. One would say that they felt the need of mutual- 
ly compensating one another for the wrong that the pro- 
hibitory system could not but cause them. And already, 
under Louis XIV, it was not alone upon such questions 
that controversy was raised : political economy was en- 
tering upon higher and more perilous discussions. The 
prodigalities of the latter part of this reign had brought 
public misery to its worst. All the resources which the 
genius of Colbert had created were exhausted. He 
was himself obliged to have recourse to oppressive expe- 
dients to satisfy the exigencies of his master ; and more 
than once, in the despair of his soul, he had increased 
taxes against which his heart and his reason equally pro- 
tested. " Five sous should be saved in unnecessary 
things," he said to Louis XIV, " and millions expended 
when the interest or the glory of the country is in ques- 
tion. A useless repast of 3,000 livres gives me incredible 
pain, but when the question is of raising millions of gold 
for Poland, I would pledge my wife and children and go 
on foot all my life to furnish it." Such was the man 
* England's Treasure by Foreign Trade, p. 11. 



POVERTY. UNJUST TAXATION. 30 1 

whose funeral was disturbed by a blinded people and 
whom it was necessary to bury at Saint-Eustache by 
night, like a public enemy. 

But this noble heritage of franchises was well received 
after his death, and generous voices were found which 
dared take up the defence of the principles and of the 
people. The marshal of Vauban * did not hesitate to 
speak stern truths, in his "Project of a Royal Tithe." 
" From all the investigations I have been able to make," 
said he, " during the many years which I have devoted 
to them, I have expressly observed that in these latter 
times, nearly a tenth part of the people are reduced to 
poverty, and, in fact, to beggary ; and that of the nine 
other parts, five are of those who are not in a condition 
to give alms to the former, because they are themselves 
reduced within a very little of the same unfortunate con- 
dition ; of the four parts which remain, three are in very 
straightened circumstances, and embarrassed with debts 
and law-suits ; and in the tenth, in which I put all the 
soldiers, lawyers, ecclesiastics, all the nobility and the 
men in military and civil offices, the good merchants, the 
bourgeois who have incomes and are most comfortable, 
one cannot reckon over one hundred thousand families, 
and I think I should not be telhng a falsehood if I should 
say that there are not ten thousand of them, small or 
great, that can be said to be in very easy circumstances." 

The marshal of Vauban had been impressed, hke Col- 
bert, by the unjust apportionment of the taxes, which 
was the greatest evil of the time ; and he deplored the 
abuse of privileges in virtue of which the richest classes 
were exempt from imposts. The idea occurred to him 
that the revenues, obtained from the people at so great 
an expense, could be advantageously replaced by one 
simple, general, and justly apportioned tax on real estate, 
fixed at one-tenth of the income in kind for the fruits of 

* Blanqui recognizes Vauban as the real author of the " Royal Tithe " 
falsely attributed, he says, to Boisguilbert. 



302 HISTORY OF POLITICAL ECONOMY. 

the earth, and in money for other property, and which he 
called for that reason the royal tithe. 

We find numerous points of similarity between his 
economic views and those which Turgot was to make 
prevail a half-century later. He demanded the suppres- 
sion of internal customs-duties and the lowering of the 
tariffs on foreign products ; a reduction of a half in the 
salt-tax and the abolition of indirect taxesfftincluding the 
ecclesiastical tithe. There were in his project of reform 
many impracticable ameliorations ; but the fundamental 
maxims on which it was based, do like honor to his judg- 
ment and to his heart. " No state," he said, " can sus- 
tain itself, if the subjects do not sustain it. Now, this 
support comprehends all the needs of the state, to which, 
consequently, all the subjects are under obligation to con- 
tribute. From this necessity there results, first, a na- 
tional obligation for subjects of every condition to con- 
tribute in proportion to their income or their business, 
without any one being reasonably exempt ; secondly, 
that it is sufficient authorization for this tax that one be 
a subject of this state ; thirdly, that every privilege which 
tends to exemption from this contribution is unjust and 
abusive, and neither can nor ought to prevail to the detri- 
ment of the public." 

But not alone on these financial generalities are the su- 
perior reason of Vauban * and his ardent love for hu- 
manity conspicuous : we iind, in the smallest details, the 
able administrator and the enlightened economist. 

It is sufficient to read, in his Royal Tithe, the chapter 
that he devoted to the salt-tax, where considerations the 
most profound are mingled with the most familiar and 
popular details. " Salt," according to him, " is a manna 
which God has bestowed upon the human race, and upon 
which, consequently, it would seem that one ought not 
to lay a tax." Then he adds : " The high price of salt 

*The finest analysis of the ideas of Vauban is found in Steuart's Investiga- 
tion of the Principles of Polit. Econ. Book v, chap. ii. — {Note of Author.) 



BAD APPORTIONMENT OF TAXES. 



303 



makes it so rare, that it causes a sort of famine in the 
kingdom, deeply felt by the humble who cannot salt 
meat for their use, for lack of salt. There is no house- 
hold which cannot support a pig; which, however, is 
not done, because there is nothing with which to salt 
it ; they do not even more than half salt their pot, and 
often not at all." Would not one think, in reading these 
simple reflections, that he was listening to a writer of an- 
tiquity? And yet the book of Vauban is little known, 
although it contains the principal bases of economic sci- 
ence, whose modern founders we daily glorify. 

Another economist, equally forgotten, of the century 
of Louis XIV, Pierre de Boisguilbert, has traced in the 
liveliest colors the sufferings and the needs of his con- 
temporaries, in a writing entitled " Detailed account of 
France under Louis XIV." In it he unreservedly points 
out the causes of the decline whose symptoms were be- 
coming manifest to all eyes ; and he insists, like Vauban, 
on the injustice of a bad apportionment of taxes, against 
which the great Colbert himself had protested in vain. 
The custom-duties are no more spared in it than in the 
book of Vauban. "They cause," he said, " nearly the 
same effects as the aids, and still more evil, by banishing 
foreigners from our ports and obliging them either to go 
elsewhere for what they came to us to obtain, or to learn 
our manufactures by attracting away our workmen." The 
same rectitude of judgment was observable in all the 
estimates of the condition of France at that time, a de- 
plorable condition, which drew tears from all generous 
men, and which had impressed with a like disquietude 
economists and poets, Boisguilbert and Vauban, Fenelon 
and Racine ! The population was everywhere continually 
decreasing. " The common people have diminished much 
in these latter times," said Vauban, " by war, by diseases, 
and by the poverty of these latter years, which have 
caused a great number to die of hunger, and reduced 
many others to beggary." 



304 HISTORY OF POLITICAL ECONOMY. 

One cannot, however, deny that the reign of Louis 
XIV, so much decried, opened the way for reforms im- 
portant in the history of political economy. Manufac- 
tures, strictly organized, gave birth to masterpieces, and 
doubled our productive forces ; commerce rose to a height 
hitherto unknown, under the control of the fundamental 
institutions which were to increase its splendor. The 
wrong of the king lay in expending more money than 
the taxes furnished him, and preventing the formation of 
capital which would have completed the work of Colbert. 
Profits were absorbed before being created, and there was 
already opening, under the auspices of Louvois, the gulf 
of the loans which were to change the science of finance 
and perfect the study of credit. France had become an 
immense workshop, from which we already see appear the 
questions of pauperism, notwithstanding the small de- 
velopment of machinery and the obstacles which the 
system of corporations put in the way of manufactures. 
The project of the Abbe of St. Pierre for perpetual peace, 
considered an utopia, contains many acute perceptions 
on these difficult social questions, and the great Economist 
school of the eighteenth century is already completely 
revealed in these remarkable words of Boisguilbert : " Al- 
though magnificence and abundance are extreme in 
France, as they exist only among a few private individu- 
als, and the greater part are in the extremest poverty, 
that fact cannot compensate for the loss which the state 
experiences for the greater number."* 

* Detail de la France sous Louis XIV, chap, vii, 1st part. 



CHAPTER XXVIII. 

Propagation of the mercantile system in Europe, under the name of Col- 
bertism. — It is neutralized by contrabandage. — Influence of contrabandage 
on the solution of economic questions. 

It is an error to regard Colbert as the founder of the 
mercantile system : we have seen that this system, which 
aims at continual selling without ever buying, came from 
the Spanish, and was the work of Charles V. It was al- 
ready obtaining recognition throughout Europe before it 
had a name ; and Colbert was not an advocate of it in 
the earlier days of his ministry, for all the ordinances of 
that period were favorable to freedom of trade. It was 
only when he determined to give an energetic impulse to 
our manufactures that he reflected on the advantage that 
might be derived from the prohibition of foreign prod- 
ucts. All manufacturers interested in raising the prices 
of commodities became henceforth his auxiliaries, and 
ardently took up the defence of a system which assured 
them immense advantages. At the same time, the public 
treasury had its share of the duties to which the import- 
ed articles were subject, and this alliance contributed 
also to strengthen public prejudice. No one would 
have dared disapprove an expedient so happy as to en- 
rich at the same time private citizens and the state. 

In fact, the true nature of the damage inflicted on the 
country by the adoption of this system, was not imme- 
diately recognized. Manufactories were seen to spring 
up on every side , the high price of their products brought 

305 



- 30^ HISTORY OF POLITICAL ECONOMY. 

considerable profits to the manufacturers, and increased 
their capital by accumulation. The French manufactures 
in silks, mirrors, cloths, and carpets no longer knew any 
rivals, and all Europe had become tributary to them ; but 
there came a time when foreigners began to employ re- 
prisals and to reject French supplies. To the tariff of 
1667 the Dutch responded, in 1 671, by the prohibition of 
French wines and brandies ; and that quarrel, wholly com- 
mercial, was nevertheless one of the principal causes of 
the war of 1672, since it was necessary to moderate the 
tariffs at the treaty of Nimeguen. However, the conta- 
gion had reached all nations, and tariff wars have not 
ceased to afflict the world since that period. 

Another disastrous consequence of the mercantile or 
restrictive system, was the absolute subjection of laborers 
to capitalists, and the increase of individual poverty in 
the presence of general wealth. This terrible contrast 
has not ceased since then to alarm modern society. An 
artificial and intense production has taken the place of 
the regular and quiet labor of previous times ; and by a 
\ strange contradiction, governments have restricted the 
I means of selling by limiting the power of buying. The 
1 mercantile system originated in the false idea that a na- 
tion grows rich by exporting and poor by importing, a 
fundamental error, the bad consequences of which have 
' been put henceforth beyond doubt by economists of 
i every country. As a simple historian, I will not review 
I the memorable debates which have arisen on that serious 
I question ; it will suffice to recall that the complications 
\ of which it is full, owe their origin to the privileges lav- 
ishly bestowed by Colbert on French manufactures, and 
that the manufactures of other nations have, in their 
r turn, had concessions granted to them. 

There is reason to think that if Colbert had been bet- 
ter acquainted with the true laws of production, he would 
have led neither his own country nor Europe into the 
perilous path which they still pursue. Following the ex- 



THE MERCANTILE SYSTEM. 307 

ample of the Spanish, this illustrious minister was too 
much preoccupied with the influence of money, and he 
did not see that, on the whole, every nation pays with its 
own products for those it obtains from foreigners, whether 
the foreigner sends gold or delivers merchandise. He 
shared the prejudice common* at a period when the re- 
cent discovery of the mines of America had procured for 
their happy possessors a supremacy envied by other na- 
tions. It was to obtain her part of the gold distributed 
in Europe, that France determined to have her accounts 
settled in specie, in spite of the train of vexations of 
every kind by which that resolution was to be accom- 
panied. 

Never, it must be said, was any paradox received 
with more enthusiasm than that on which rested the 
whole theory of the mercantile system. In France, in 
England, in Germany, in Italy, and in Spain, all the 
writers were unanimous in lauding the marvels of indus- 
trial isolation without considering that this system was 
destroying itself by becoming general, and that the hope 
of selling without buying would be lost whenever every 
nation should wish to force its neighbors to buy without 
selling. The most learned economists became the propa- 
gators of that doctrine, and their number was so great 
that the mere mention of their writings will occupy sev- 
eral pages of this work.f Administrations were not slow 

* Don Bernardo de UUoa has pointed out with great clearness the general 
error of his countrymen on the subject of metallic wealth : 

" When we saw ourselves masters," he says, " of the New World and its 
mines, we confidently thought this vain title would secure us forever the en- 
joyment of these treasures ; we seemed to see the nations come to us in 
Immble dependence to seek the superfluous portion of our wealth. De- 
ceived by that flattering chimera and satisfied with the beauty and cheapness 
of foreign fabrics, we abandoned care for our manufactures : foreigners 
profited by a negligence so favorable to increase their own, and soon, by this 
means, took away from us not only all the gold and silver which the Indies 
had produced for many years, but even our valuable raw materials, which 
their manufactures could not do without." — On the Reestablishi>ient of the 
Mamtfacfures and Conwierce of Spain, p. 3. 

f The French editions of Blanqui have an analytical bibliography st the 
end of the work. — Trans. 



308 HISTORY OF POLITICAL ECONOMY. 

in adopting their ideas, which have given rise to all the 
obstacles waiting for the grand commercial reformation 
whose dawn we are beginning to discern. If great pri- 
vate interests have been created under the control of this 
prejudice, this is not a reason for despairing of the amel- 
iorations imperiously demanded by general interest. 
" The disbanding of an army," says Adam Smith, " in- 
volves also some inconveniencies : must we then remain in 
a state of perpetual war, for fear of dismissing a few sol- 
diers? " 

The mercantile system has lived thus long only be- 
cause it was, at the outset, clothed with a dogmatic form. 
Wealth, it was said, is money : with money one com- 
mands labor, and furnishes subsistence to laborers. 
Money is the sinews of war and the source of power. 
Whoever possesses it, commands those who have it not. 
All the efforts of a good government must then aim to 
procure the most possible for the nation ; and as the 
quantity in each state can only be increased by the ex- 
ploitation of mines or by importations from without, 
people must either have mines or get possession of foreign 
money by export trade. From the point of view of this 
system, home trade is of scarcely any importance, be- 
cause it does not increase the mass of specie, and the re- 
sult of the exchanges give no favorable balance in coin. 
What one loses, the other gains, but there is no increase 
in wealth. Foreign commerce, on the contrary, presents 
the immense advantage of an opportunity to settle the 
transactions in money ; and for this reason they must be 
so regulated as to export much and import very little. 
The beau-ideal would be to import nothing at all, but 
they limited themselves to requiring that a nation should 
make no other exchanges than those which procure a 
payment in specie ; and, in this case, they said the bal- 
ance of trade was favorable to it. 

• The consequences of this system are easily deduced, 
so that foreigners may not carry off our gold, we must 



MERCANTILE SYSTEM. SMUGGLING. 309 

buy nothing of them to be paid for in coin, and we must 
sell them all we can so as to have their money. But sup- 
pose they take a notion to manufacture in their turn and 
to do without us ? In this case, we have the resource of 
prohibiting the export of our raw materials, in order to 
prevent them from working and to force them to leave us 
the profits on the manufacture. Such are the necessities 
of that political economy which involves prohibitions of 
imports and prohibitions of exports, and favors obstruc- 
tions and poverty at every point. Unfortunately, the 
patent for that fine invejttion has expired, to use the ex- 
pression of Mr. Huskisson. All nations have in turn pro- 
hibited the export of raw materials and the import of 
manufactured articles; they are henceforth obliged to 
turn back upon themselves and seek a refuge in home 
trade, after having exhausted all the artifices of treaties 
and suffered all the reprisals of tariffs. What have they 
gathered on this battle-field as a trophy of victory? 
Pauperism, tariff-wars, commercial crises, a high price for 
all the products which Providence had scattered, so to 
speak, along our path. And yet the mercantile system 
has survived the concert of maledictions with which it 
was overwhelmed by the Economists of the eighteenth 
century; it still reigns in our day in the councils of gov- 
ernments, and it maintains under the mask of an inter- 
ested patriotism all the monopolies from which Europe 
suffers and of which she complains. 

However, it is in the nature of bad institutions never 
to be respected, and to give birth to protests which end in 
bringing about reform : smuggling was to the exclusive 
system the most constant and the most expressive of 
these protests. Smuggling has become in our day a veri- 
table half-commercial, half-military power, which has its 
leading stations and its official rates, its veteran soldiers 
and its experienced chiefs. It is as exact in its deliveries 
as the most scrupulous merchants ; it braves the seasons 
and defies the best guarded lines of custom-houses, to 



310 HISTORY OF POLITICAL ECONOMY. 

such a degree that assurance companies which protect it, 
count upon fewer losses than any others. Smuggling is, 
in fact, the only means which remains to the various in- 
dustries to procure for themselves the prohibited pro- 
ducts whose use is indispensable to them. It has not 
ceased to increase with the expansion of general business, 
and at many places in Europe, it is systematized with 
truly marvellous skill. It is owing to smuggling that 
commerce did not perish under the prohibitory regime : 
while that regime condemned people to supply them- 
selves from the most distant sources, contrabandage made 
the distances less, lowered prices and neutralized the dis- 
astrous action of monopolies. An invisible and con- 
stantly renewed competition kept the privileged ones 
alive and indemnified consumption for the rigor of the 
tariffs. Although its very existence is an offence to the 
law, smuggling has nevertheless contributed to the solu- 
tion of almost all the questions of political economy 
relative to exchanges. While savants discuss and com- 
merce entreats, contrabandage acts and decides on the 
frontiers ; it presents itself with the irresistible power of 
actual facts, and freedom of trade has never won a vic- 
tory for which smuggling has not prepared the way. 
I If we carefully examine the periods when contraband 
I trade has prospered, we shall be easily convinced that it 
\ has always been in the countries and at the times when 
I the mercantile system was in vigor. The Spanish colo- 
5 nies in America were always a centre for it. When Na- 
I poleon decreed the continental blockade, Russia, Ger- 
Imany and Holland became covered with smugglers ; the 
' emperor himself was obliged to authorize the fraud by 
means of licenses, which became an irregular source of 
so many fortunes. The war of 1812, declared against 
Russia, originated principally in the opposition of the 
Russians to the demands of French prohibition ; and 
th-ere was a time when smuggling was the only resource 
of European commerce. If, in this cursory view of the 



CONTRABANDAGE MODIFIES TARIFFS. 3 II 

revolutions of economic science, it were permissible to 
cite special recent facts, we could easily demonstrate that 
to contrabandage alone must be attributed the modifica- 
tions imposed upon the exclusive system. Our manufac- 
turers of muslin obtained the conditional importation of 
foreign-spun cotton only after having long provided them- 
selves with it by fraud ; and our tariffs on horses were 
moderated only after a public acknowledgment* that the 
smuggler mounted his merchandise and galloped off with 
it. How many commodities to-day rare and dear, would 
have their tariff lowered, if the smuggler could take them 
on his saddle and cross the boundary with them ! A not- 
able perfecting of the fraud would be sufficient to over- 
throw all the tariffs in the world and oblige each nation 
to maintain itself by the kind of production peculiar to 
its soil or to the genius of its inhabitants. 

The mercantile system was no more fortunate in its 
persistent attempts to attract money from foreign coun- 
tries than in excluding their commodities. In vain, laws 
prohibited the export of gold under severe penalties : in 
vain, as in England, governments attempted to make the 
balance incline in their favor, and published tables of ex- 
ports greater than those of imports : England did not 
keep one guinea the more on that account, and she is to- 
day the country where there is the least specie. Spain, 
that classic land of prohibitions, has constantly furnished 
gold to all Europe. Paper-money has driven out coin 
wherever its presence has diminished the value of coin, 
in spite of the penalty of death inflicted on the -smug- 
glers. The fear of paying for foreign commodities with 
the precious metals is a vain fear; the precious metals 
never go from one country to another to pay pretended 
balances, but to seek the market where they will bring 
the most. It is always well for us to consume the pro- 
ducts which a foreign country furnishes of a better quality 

* The acknowledgment was made in one of the sittings of the parliamen- 
tary session of 1836. 



312 HISTORY OF POLITICAL ECONOMY. 

or at a lower price than our own, and we may rest as- 
sured that the foreigner will always be paid in things 
which we produce more cheaply than he. " I say that he 
will be paid thus, because it cannot be otherwise." * His- ■ 
tory is full of the contradictions which events have given 
to government policy, when the latter has attempted to 
interfere in the interests of exclusion or of resentment. 
When Philip II, after having become master of Portugal, 
determined to forbid his new subjects all communication 
with the Dutch, the latter, excluded from the entrepots 
of Lisbon, where they had been accustomed to provide 
themselves with merchandise from India, themselves went 
to the Indies for these goods ; and that which had been 
done to cause their ruin, was the origin of their greatness. 
Later, the National Convention of France having pro- 
hibited the importation of undressed leathers from Spain, 
under pretext that they would injure those of our coun- 
try, the Spanish, obliged to consume their raw leathers, 
began to tan them themselves, and that business passed 
into Spain with a good part of the French capital and 
workmen. The same thing took place in the kingdom of 
Naples, where the duties increased by us on wools from 
that country, forced the producers to close to our cloths 
a market of the highest importance. 

The evils of the mercantile system have been convinc- 
ingly shown by the writers of the Economist school, and 
unanswerably proven by Adam Smith,f J. B. Say,:j: and 
the most renowned authors. This system is to-day main- 
tained only on account of difificulties which owe their 
existence to its long continuance. No enlightened man 
in Europe any longer believes in the marvels of the bal- 
ance of trade ; but the grave complications to which the 
system has given rise cannot be resolved without clashing 
with numerous interests with which the over-scrupulous 

* J. B. Say. Treatise on Polit. Econ.^ vol. i, p. 257. 

\ Wealth of Nations. Book iv. 

X Traitd d'Economie Politique. Vol. i, p. 218-80. 



WHEN HIGH TARIFFS WILL CEASE. 313 

prudence of governments refuses to interfere. Being in- 
timately connected, besides, with the fiscal receipts, the 
doctrine of high tariffs finds protectors in the statesmen 
who fear lest they may compromise at the same time 
public revenues and private enterprises. It will be by 
the advance of public credit that the mercantile system 
will perish ; whenever its consequences shall have been 
carried to their extreme limit, and produced a general 
obstruction in industries, it will be necessary to return to 
the system of freedom, which alone can reestablish an 
equilibrium between production and consumption. 



CHAPTER XXIX. 

The first contest between the Mercantile system and Free-Trade, between 
England and Holland. — Disastrous effects of that contest. — Navigation Act. 
—Eloquent phillippic of M. d'Hauterive against the Restrictive System. 

There was a time when, in Europe, ^the mercantile 
system and that of free trade came into collision, under 
the flags of two powerful nations, England and Holland. 
When the former country defied the latter, the latter 
had risen to a very high degree of wealth and splendor 
by the free development of the wealth of its inhabitants 
and without the aid of any restrictive law. The Dutch 
presented to the world a striking example of what the 
genius of a hard-working people can accomplish, when it 
is seconded by commercial institutions founded on the 
principle of liberty. Their territory produced scarcely 
any cereals, and yet scarcity was so unknown among 
them, that Europe applied to them in her extremity. 
" Let famine prevail elsewhere," said the author of " The 
Riches of Holland," " and you will find wheat, rye, and 
other kinds of grain at Amsterdam : they are never lack- 
ing there." By their organization, the Dutch had neces- 
sarily become the universal intermediate agent in com- 
merce. Sir William Petty estimated, in 1690, the ton- 
nage of their vessels at more than nine hundred thousand 
tons, which was nearly half of all the tonnage of Europe ; 
and nevertheless they had no product of their own to 
export. Their country was the general storehouse for all 
products of industry, and their ships, as Sir William 

314 



DUTCH INDUSTRIES. NAVIGATION ACT. 315 

Temple said, the carriers of the ocean. Division of la- 
bor was practiced by them with admirable intelligence ; 
not only merchants, but entire cities, were exclusively occu- 
pied with one single branch of commerce. Middelburg, 
for example, carried on the trade in wines ; Flushing, 
that with the West Indies ; Saardam was peopled with 
ship-builders ; Sluys, with fishers of herrings. In each of 
these branches, there existed an active competition, and 
all were conducted with an ability and economy worthy 
to serve as a model. When, after the treaty of Aix-la- 
Chapelle, the stadtholder made a sort of investigation for 
the purpose of learning the useful projects which could 
be proposed to him by his fellow-citizens, the Experienced 
business men whom he consulted classed in the first 
rank among the causes of the former prosperity of Hol- 
land, the maxims of toleration, that is to say, of political 
and commercial freedom, which the confederation had 
made their law. If, later, that country descended from 
the high position to which that liberal policy had raised 
it, we must attribute it only to the introduction of mo- 
nopolies, notably that of the India companies, which 
became the most shameful source of abuses, I might al- 
most say, a nursery of crimes. 

It was then that England undertook to oppose the 
prosperity of the Dutch by her famous Navigation Act,. 
which secured for English vessels the monopoly of trans- 
portation, by absolute prohibitions in certain cases, and 
by heavy fines in others, on foreign navigation. All ves- 
sels, of which the proprietors, masters, and three-fourths 
of the crew, were not English subjects, were forbidden to- 
trade in the establishments and colonies of Great Britain, 
or to carry on a coasting trade along her coasts, under 
penalty of confiscation of vessel and cargo. Other re- 
strictive measures completed this system of exclusion,, 
from which arose the most fiercely contested maritime 
war of which history makes mention. France played 
her part in it against the Dutch by the announcement 



3l6 HISTORY OF POLITICAL ECONOMY. 

of the tariff of 1664 ; and from that time the most en- 
lightened nations of Europe have constantly vied in their 
efforts to injure one another, instead of trading together 
on loyal bases. These reciprocal hindrances have nearly 
annihilated all regular trade on a large scale between 
them, and put into the hands of smugglers the principal 
part of the importation of English merchandise into 
France, and of French merchandise into England. Com- 
merce, long given over to the monopoly of privileged 
companies, has degenerated since then into exactions 
and rapine of every species. Thus our fathers saw three 
great companies dispute with each other by most violent 
measures the spice-trade of the Indies. The Dutch with 
sacrilegious harshness destroyed the clove trees of the 
Moluccas, to prevent their rivals from sharing in the 
crops. The sole idea which preoccupied these com- 
panies was to exclude competition, to grasp for them- 
selves the monopoly of certain articles, and to limit the 
supplies of them, so as to raise the price enormously 
high. If any one wishes a striking proof of the ruinous 
influence of this system and of its tendency to restrict 
the natural limits of the field of commerce, he will find 
it in the fact that American merchants who trade freely 
to-day with the possessions of the Netherlands, in the 
Eastern archipelago, employ more ships than did the 
Dutch monopolists. The recent abolition* of the priv- 
ilege of the English East-India Company has neverthe- 
less contributed to increase the relations of England with 
the peninsula of Hindustan. One simple fishing station 
has become, under the influence of free trade, an estab- 
lishment of the first order, in less than twenty years. 

Wherever the principle of liberty has had a struggle 
with that of monopoly, the same results have been mani- 
fest. It is vain to pretend that the Navigation Act was 
the source of the industrial development of Great Britain : 
that act can be considered only as a sacrifice imposed on 

* 1833 was the year when the trading privileges were taken away. Trans. 



THE NAVIGATION ACT. 317 

commerce, in favor of policy. Adam Smith justified it 
only on this ground;* and yet to-day we may doubt, 
looking at the definite results of its adoption, whether 
that act was a work of wise policy. The principal result 
of its vigorous enforcement was to daily reduce more the 
trade of England with other European nations, and to 
oblige that empire to seek in its colonies markets which 
the exclusion of foreigners had made it lose among them. 
The fortune of Great Britain began from that time to 
rest on artificial bases ; it was necessary for her to main- 
tain considerable fleets to protect distant settlements, 
whose independence continually threatened to strike at 
the heart of her industries, which had become accus- 
tomed to the system of monopolies. Hardly ten years 
aero, Mr. Huskisson pointed out in parliament these dan- 
gerous probabilities; and still neither England nor 
Europe are yet cured of the pernicious doctrines of 
Charles V.f These doctrines accustomed nations to 

* " As defence is of much more importance tlian opulence, the navigation 
act is, perhaps, the wisest of all the commercial regulations of England." 
Wealth of Nations, Book iv, chap. ii. 

f The great commercial revolution which took place in England under 
the influence of the Free Trade League has carried away also the Navigation 
Act, at least in its essential features. We borrow from an article by M. 
Henri Baudrillart, inserted in the Dictionnaire du Commerce et des Marchan- 
dises (Guillaumin, 1859) the history of the gradual modifications which 
ended by the entire abolition of that famous act ; 

" For more than 130 years, the Navigation Act subsisted without sensible 
alteration. The independence of the colonies of North America gave it the 
first blow. Henceforth separated from the parent state, North America 
could no longer claim to trade with British ports in virtue of its old colonial 
privileges ; and on the other hand, the act formally excluded, in the trade 
with America, any foreign flag. It was impossible, however, that the new- 
state should remain under the ban of such an exclusion ; never would it 
have consented to abandon to English ships all the carrying trade; the 
Navigation Act was therefore obliged to yield. After quite long negotiations 
between the United States and England, in which various systems were 
proposed and debated, it was agreed that the vessels of the new state, 
although coming from America, should be admitted, against the tenor of the 
law, to the ports of Great Britain, on the same conditions as those of the 
old 'established states of Europe. Later similar relaxations were allowed 
in favor of the former Spanish and Portuguese colonies of South America, 
as fast as they became independent of their mother countries, as well as in 
favor of the black republic of Hayti. Moreover, the English Antilles, which 
were accustomed, in case of pressing need, to count upon supplies from the 
North American colonies, found themselves, in consequence of the separation 
of the United States from Great Britain, unexpectedly left unprovided for ; 



3l8 HISTORY OF POLITICAL ECONOMY. 

consider as useful measures all' those which presented 
a character of hostility to their neighbors ; they made 
pass into all codes a new law of nations, in virtue of 
which the good of each seemed to have for its principal 
element the evil of some other. Whatever revolutions 
have since agitated the world, this fatal prepossession 
has remained the same, during the war of the United 
States of America, during the French Revolution, after 
the emancipation of the Spanish colonies, after that of 
Greece, and even after the conquest of Algiers. In vain 
have privileged companies perished, one after another ; 
in vain monopoly has brutalized and decimated the 
population of South America, while in North America 
freedom has enriched them and multiplied them tenfold : 
the mercantile system pursues its ravages and receives 
from the most advanced governments only weak and ill- 
it was then necessary to allow, in their interest, new derogations from the 
Navigation Act. It thus became gradually broadened and moderated by 
the concessions of commercial treaties founded on the principle of reci- 
procity, until its entire suppression in 1849. 

"It is not for us to recount in detail the history of these successive der- 
ogations from the primitive act of Cromwell, which were wrung from 
British policy by the force of circumstances. * * * 'phe incessant tariff 
laws between North America and England after 1792, the time when the 
United States, not being able to obtain from its mother country the adoption 
of the principle of reciprocity, made its congress adopt a Navigation Act 
corresponding in certain respects with the English act, although more 
elastic, as it authorized the government to suspend its effects whenever 
arrangements concluded with other nations should require ; these tariff- 
laws, we say, ended in 1815, at the conclusion of a treaty of commerce and 
navigation founded this time on the principle of reciprocity and equality of 
rights. An analogous treaty was concluded in 1823 with Prussia, not with- 
out a strong repugnance on the part or the English government and people, 
who consented to it only under the influence of demands which were taking 
a threatening form, and which tended to become general. A first amend- 
ment of the navigation act in 1825, under the ministry of Mr. Huskisson, 
who inaugurated the tariff reform, and a second amendment in 1845, under 
the ministry of Robert Peel, who was to complete that reform, added so 
many exceptions to the principal clauses of the Navigation Act, that it had 
almost disappeared, while seeming, on account of. the pains taken to respect 
its primitive form, to subsist as in its finest days. To Lord John Russell 
belongs the honor of having triumphed over the last opposition of a tradi- 
tional attachment, and having called forth the repeal of the act itself. Some 
of the restrictions it contained still exist, it is true, in the executory law of 
Jan. I, 1850, which has taken its place ; but the object of the English gov- 
ernment in obtaining them was to take away the occasion for new facilities 
for smuggling, rather than to act with a view to protection. Thus the re- 
strictions in everything concerning coasting trade, and those concerning 



EFFECTS OF PROHIBITORY LAWS. 319 

directed blows. " The theory of prohibitory laws," says 
M. Hauterive,* " is written in letters of blood in the his- 
tory of all the wars which for four centuries have every- 
where brought industry into conflict with power ; which 
oppress the one, corrupt the other, degrade political 
morals, infect social morals and devour human kind. 
The colonial system, slavery, the hatreds born of avarice, 
called commercial wars, have caused a flood of errors to 
issue from that Pandora's box; — false maxims ; excessive, 
corrupting and badly distributed wealth ; poverty, ignor- 
ance and crimes, which have made of human society, at 
some epochs in the history of modern nations, a picture 
so odious that one dare not stop to gaze at it, for fear of 
having to pronounce against the development of indus- 
tries and the progress even of civilization." 

* Elements of Polit. Econ., p. igg. 

inter-colonial trade are maintained, except the special authorizations, and 
finally those which relate to the formation of English crews." 

With the prohibitory and restrictive laws fell also the colonial system. In 
the session of the House of Commons, on the February 8, 1850, Lord John 
Russell thus expressed the new principles which were henceforth to guide 
the conduct of Great Britain in regard to her colonies ; "In what concerns 
our commercial policy, the entire system of monopoly is no more. The 
only precaution that we have henceforth to take, is, that our colonies grant 
no privilege to on'e nation to the detriment of another, and that they im- 
pose no duties on our products sufficiently high to be equivalent to a pro- 
hibition. I think we have a right to make that demand in return for the 
security we afford them." * * * " ^yg ought not to attempt to go 
back, in any respect, from that decision" (referring to the substitution of free- 
trade for monopoly. — TV.), "but that you shall trade with your colonies on 
the principle that you are at liberty to obtain productions from other 
countries, where they may produce better or cheaper than in the colonies, 
and that the colonies should be at liberty to trade with all ports of the 
world, in the manner which may seem to them most advantageous. That, 
I say, must in future be a cardinal point of our policy. 

" In conformity with the policy on which you have governed your British 
North American colonies, you should, as far as possible, proceed upon the 
principle of introducing and maintaining political freedom in all your colo- 
nies. I think whenever you say political freedom cannot be introduced, you 
are bound to show the reasons for the exemption, and to show that the people 
are a race among whom it is impossible to carry out free institutions — that 
you must show that the colony is not formed of British people, or even that 
there is no such admixture of British population, as to make it safe to intro- 
duce representative institutions. Unless you can show that, I think the 
general rule would be that you should send to the different parts of the 
world, and maintain in your different colonies, men of the British race, and 
capable of governing themselves ; men whom you tell they shall have the 
full liberty of governing themselves ; and that while you are their repre- 



320 HISTORY OF POLITICAL ECONOMY. 

However, in spite of this sombre picture, the prohibi- 
tory system carried in itself the germs of a renovation 
which has greatly diminished its disastrous effects. The 
incontestable impetus which it gave to production, in 
England, France and Holland, especially at the begin- 
ning, contributed much to raise the rate of profits in all 
the protected branches of industry, and made immense 
amounts of capital flow in, which also soon became in- 
sufficient. Consequently the bank of Holland and the 
bank of England were called to provide by credit for the 
daily increasing needs of the industry and commerce of 
the two countries. The fortune of these banks is inti- 
mately connected with the Navigation Act and with the 
establishment of manufactures,* and it is explained in a 

* " The act establishing the Bank of England (July 27, 1694) is thus 
entitled in the primitive charter of concession : Ait act for granting to their 
majesties several duties upon tonnage of ships and vessels, and upon beer, ale 
and other liquors, for securing certain recompetices and advatitages in the 
said act mentioited, to such persojts as shall voluntarily advance the sum of 
ffteen htmdred thousand potmds, towards canying on the war with France." 
Gilbart, History of Banking, p. 27. 

sentative, with respect to all foreign concerns, you wish to interfere no 
farther in their domestic concerns than may be clearly and decidedly neces- 
sary to prevent a conflict in the colony itself. 

" I believe these are the sound principles on which we ought to proceed. 
I am sure, at least, they are the principles on which the present government 
intends to proceed. ^•- * * J believe not only that you may proceed on 
those principles without any danger for the present, but there may be ques- 
tions arising hereafter, which you may solve, without any danger of such an 
unhappy conflict as that which took place with what are now the United 
States of America. On looking back at the origin of that unhappy conflict, 
I cannot but think that it was not a single error or a single blunder which 
got us into that contest, but a series of repeated errors and repeated blunders 
— of a policy asserted, and then retracted — again asserted, and then conces- 
sions made when they were too late, — and of obstinacy when it was unreason- 
able. I believe it was by such a course we entered into the unhappy con- 
test with what were, at its commencement, the loyal provinces of North 
America. I trust we shall never again have to deplore such a contest. I 
anticipate indeed, with others, that some of the colonies may so grow in 
population and wealth that they may say: "Our strength is sufficient to 
enable us to be independent of England. The link is now become onerous 
to us ; the time is come when we think we can, in amity and alliance with 
England, maintain our independence." I do not think the time is yet ap- 
proaching, but let us make them as far as possible, fit to govern themselves ; 
let us give them as far as we can the capacity of ruling their own affairs ; 
let them increase in wealth and population, and whatever may happen, we 
of this great empire shall have the consolation of saying that we have con- 
tributed to the happiness of the world." 

One may consult on this great economic revolution, RiCHELOT, Hisioire de 
la Re forme Cojnmerciale en Angle terre, 1855., — French Editor. 



ORIGIN OF BANKS. 32 1 

natural manner by the advantages which resulted from 
them for the companies, which, sheltered by credit, were 
in a position to defy the slowness of the return voyages 
from the two Indies. It was also from credit that Louis 
XIV, when dying, demanded a reparation of the errors 
and prodigalities of his reign, which engendered, as every 
one knows, the system of Law. 



CHAPTER XXX. 

Rise of credit in Europe. — Institution of banks. — Their influence on the 
course of political economy. — Banks of deposit, and particularly that of 
Amsterdam. — Banks of circulation. — The Bank of England. 

Few revolutions have exercised such an influence on 
the course of civiHzation as that of the foundation of 
credit in Europe. This was a new conquest of the 
genius of man, and an immense force added to all those 
at his disposal. Whence came that force ? By what 
combination of circumstances did it manifest itself, at 
the very moment when it seemed as though the dis- 
covery of the mines of America would render it super- 
fluous ? How, after so many benefits, did it become so 
fecund in catastrophes that enlightened minds even went 
so far as to curse its existence ? Its real source is lost in 
the night of time. We know that there were bankers at 
Rome and at Athens, that there were such also in the 
middle ages, and that public banks were founded, in 1157 
at Venice, in 1349 at Barcelona, at Genoa in 1407, at 
Amsterdam in 1609, at Hamburg in 1619, and in 1694 in 
England. Such are the facts and the dates : it remains 
for us to explain them. 

The first effect of the discovery of the New World was 
to give a truly feverish impulse to speculations in America. 
Capital, attracted by the allurement of enormous profits, 
flowed toward speculative commerce, to the detriment of 
many other branches of industry, more useful, and above 
all, less venturesome. Raw materials hitherto unknown, 

322 



TRADE. INSTITUTION OF BANKS. 323 

such as sugar, cotton, tobacco, and spices, entered into 
consumption and became the objects of an immense trade. 
Numerous ships set sail from all the ports of Europe, to 
return with rich cargoes; but it was necessary to await 
their return in order to reap the profits, and the length of 
the voyages necessitated considerable advances. Hence 
the first banks were all established in maritime cities. 
Later, the prohibitory system, by calling toward manu- 
factures a part of the capital which had been devoted to 
foreign trade, caused the necessity of credit to be daily 
more felt, and new banks sprung up from the needs of 
labor. 

Nothing is more simple and more ingenious than the 
fundamental principle of these banks, the establishment 
of which separates ancient from modern political econ- 
omy, as two very distinct epochs. Among the ancients, 
production had no resources but in the labor of slaves and 
the capital of money-lenders ; among moderns, it had 
for support freedom of the workman and the facilities of 
credit. As soon as it was perceived that the money which 
merchants were obliged to keep on hand to meet their 
payments, was, while in their hands, unproductive capital, 
people reflected how they could make it productive, by 
substituting the promise for the money and creating 
banks. " The gold and silver money which circulates in 
any country," said Adam Smith * on this subject, " may 
very properly be compared to a highway, which, while it 
circulates and carries to market all the grass and corn of 
the country, produces itself not a single pile of either. 
The judicious operations of banking, by providing — if I 
may be allowed so violent a metaphor — a sort of wagon- 
way through the air, enable the country to convert, as it 
were, a great part of its highways into good pastures and 
corn-fields, and thereby to increase very considerably the 
annual produce of its land and labor. The commerce 
and industry of the country, however, it must be acknowl- 

* IVeaith of Nations, Book ii, chap. 2. 



324 HISTORY OF POLITICAL ECONOMY. 

edged, though they may be somewhat augmented, cannot 
be altogether so secure, when they are thus, as it were, 
suspended upon the DaedaHan wings of paper money, as 
when they travel about on the solid ground of gold and 
silver." 

This passage from Smith characterizes in an exact and 
picturesque manner the true properties of credit. But 
the first banks of Europe did not risk a flight on Daedalian 
wings, and their timid attempts were far removed from 
the hazardous operations of the banks of our day. They 
modestly called themselves banks of deposit, and their 
coffers always contained in specie, sums equal to the 
amount of their notes. These notes were only certificates 
transferable by indorsement, like our bills of exchange, 
and they presented at first no other advantage than 
economy in the transportation of specie. Each paper 
florin had its guaranty in coin ; only, the coins were of a. 
certified weight and fineness, so as to relieve the holders of 
commercial paper of all uncertainty, and to give the bank- 
money a stability which should render it superior to any 
other. In vain the neighboring states altered their money 
or allowed themselves to be invaded by depreciated coin : 
the simple stipulation of payment in an order or transfer 
on the bank of deposit protected by the state, secured to 
this standard a decided superiority, and soon all payments 
were stipulated to be made in bank-money. However, the 
certificates of deposit were limited by the amount of the 
sums paid in, and the circulation, in being made by means 
of paper, had only the advantage of being more convenient 
and more speedy. 

The Bank of Amsterdam was the first one based on 
this simple regulation ; for what we know of the 
Bank of Venice and that of Genoa does not permit a 
doubt that these banks were anything but great adminis- 
trative agents of the government for the collection of its 
revenues. The spirit which ruled at the foundation of 
the bank of Amsterdam was entirely different. The 



PAPER SUBSTITUTED FOR COIN. 325 

able business men who originated it, had wisely con- 
sidered that every saving in the expense of maintain- 
ing the fixed capital of a country is a source of advan- 
tage to its revenue. Now, everything that is not retained 
in this immovable capital, belongs to the circulating capi- 
tal, which provides raw materials and the wages of labor, 
and gives activity to all branches of industry. The sub- 
stitution of paper for gold and silver money, was one 
way of substituting a more simple and economical com- 
mercial instrument for an extremely expensive one. This 
advantage would be the first to impress merchants as 
intelligent as those of Amsterdam ; but it was not the 
only one which the organization of the bank from which 
they were to derive so large profits, offered them. Hol- 
land was then flooded with a great quantity of foreign 
money, worn down and clipped, which her extensive trade 
brought in from all the countries of Europe, and which 
had reduced the value of current money to nine per cent, 
below good new coin. Besides, the latter was melted 
and exported as soon as it appeared in circulation, and 
traders knew not where to obtain specie to pay their 
bills of exchange, the value of which became from day 
to day more variable, to the great detriment of their in- 
terests. 

This was the first object of solicitude to the founders 
of the establishment. The bank only received good or 
bad foreign coins and the coins of the country itself 
according to their intrinsic value, and it decided to ex- 
change them for good standard money, by simply deduct- 
ing the expense of coinage and of management. The 
bank-money from this time obtained a marked favor over 
current money, and this circumstance considerably in- 
creased the demand for the bills. The city of Amster- 
dam was responsible for their payment, and the facilities 
which the employment of these notes afforded to com- 
merce, raised their price sensibly above their real ^ value, 

* i.e., par value. Blanqui seems to have shared the common belief that 



326 HISTORY OF POLITICAL ECONOMY. 

However, this superiority was recognized only in so far 
as the corresponding coin remained on deposit in the 
coffers of the bank, from which, besides, one could with- 
draw it only at a disadvantage, since it was necessary to 
pay a certain sum for the expense of guarding, or rather 
of withdrawing it. Later, the bank gave credit on its 
books, in exchange for deposits of gold and silver bullion, 
and this contrivance added new facilities to those 
which its bills of credit already presented. We readily 
perceive that, as the value of these bills depended entirely 
on the presence of the coin given in exchange, it was 
necessary for the bank to carefully guard its coffers and 
for the government to be able to resist taking supplies 
from them in time of need. Hence, the direction of the 
establishment was entrusted to four magistrates, renewed 
every year, who, under oath, verified the condition of the 
treasury on entering upon their official duties, and com- 
pared it with the condition of the books. It is a fact 
generally known, that when, at the approach of the 
French, in 1672, the bank decided to have the amount 
of the deposits distributed to the parties having claims, 
the specie taken from its vaults still bore the traces of a 
fire which had broken out some years previously. Public 
and private credit began thus to be founded on confi- 
dence ; and we should honor the men who gave this 
noble example to modern associations. Economic science 
had now taken an immense step. It was demonstrated 
that metallic money was unnecessary in order to de- 
velop industry and commerce, since a few millions of 
flying leaves sufficed to take its place in all transactions. 
Credit thus became truly capital in the hands of the 
workers and prepared the way for their emancipation, by 
investing them with a sort of unlimited property, the 
most respectable of all, because it is founded on the ser- 

there is such a thing as intrinsic value. On " Error of the expression In- 
trinsic Value," see H. D. Macleod, Economical Philosophy, vol. i, chap, v, 
g 2. (Longmans & Co,, London.) Trans. 



ORIGIN OF BANKS OF CIRCULATION. 327 

vice of labor and respect for engagements. Nothing will 
henceforth arrest the effect of human intelligence, as in 
the unhappy times of Roman usury and feudal servi- 
tude ; and history, far from contradicting the theories 
of political economy, will only confirm them each day. 

The Bank of Amsterdam and the other banks of de- 
posit established on a similar basis, were, however, only a 
first attempt in the ways of credit. They undoubtedly 
gave to gold and silver a more active power of circula- 
tion, under the form of transferable certificates ; but, ex- 
cept the profit resulting from the agio (premium on the 
bills. — Trans}), the value of monetary capital was not 
augmented by its transformation into bills of credit. 
Europe remained with the simple resource of its money 
augmented by all the gold and silver imported from Amer- 
ica ; but this was insufificient to respond to the demands of 
production which this new element of wealth had called 
forth. A great step had been taken ; a still greater was 
needed, and the banks of deposit became banks of circu- 
lation. Since the certificates of the former were accepted 
as money, by reason of the confidence had in the guar- 
anty of the deposits, why might not that confidence be 
carried a little farther, by increasing the number of bills 
to a sum greater than the amount of the deposits ? What 
disadvantage could result for the holders of these effects, 
who were certain of being paid in specie whenever they 
manifested such a disposition ? Did not one see every 
day the notes of a banker circulate with all the privileges 
of money, even to bearing interest like money itself? 

All that was needed was to determine, by sure calcula- 
tions, what, on a given amount of business, would be the 
quantity of notes presented for redemption, in order to 
have always on hand the sum of money necessary to 
meet them. Any economy, however small, in the reserve 
funds, became an advantage to labor, and might serve to 
give support to new manufactures. It could be ex- 
ported, if people were so disposed, to increase the capi- 



328 HISTORY OF POLITICAL ECONOMY. 

tal devoted to foreign commerce. 'It was as if the 
general wealth of the country had been increased by 
so much at the cost only of the printing or the engrav- 
ing of the bills which were substituted for the silver. 
Here the perfect justness of the comparison of credit 
to the wings of Icarus, so poetically conceived by Adam 
Smith, begins to be manifest. No one can affirm the 
ratio that exists between the sum of money in circula- 
tion in a country and the total value of the annual pro- 
duct which it puts in circulation. Ought the banks of 
circulation to reserve a third, a fourth, a fifth, or a half of 
their capital in specie, in order to be always ready to re- 
deem whatever part of their issues should be presented 
for conversion into coin ? Was there not perpetual danger 
of being confronted by continual calls for redemption? 
For it is principally by discounting bills of exchange, 
that is to say, by advancing money on that security, that 
banks issue their bills. The profits consist in the in- 
terest on these bills until the maturity of the bills of 
exchange. The payment alone brings a return to the 
bank of the advances which it has made, with the profit 
of the interest it has previously deducted. What would 
happen, then, if, after having given its notes in exchange 
for commercial bills, these effects were not paid at matu- 
rity ! What resource would remain for the holders of 
notes of the bank, if the security of its creditors perished 
in its hands? 

From this point of view, especially, banks of circula- 
tion are far from presenting the same ground of security 
as banks of deposit. They render more services than the 
latter; but they offer fewer guaranties. Their directors 
do not know how to guard against the natural tendency 
to discount, that is to say, to realize an assured, imme- 
diate and palpable profit, by means of a simple bill which 
is only a promise. Most banks have been ruined by the 
abuse of their peculiar principle, and on account of not 
having taken sufficiently into calculation, that, by multi- 



RESULTS OF CREDIT. 329 

plying their discounts, they exposed themselves to the 
loss of their reserves. Adam Smith, James Steuart, J. 
B. Say, and M. Storch, and especially M. de Sismondi 
have explained, in the clearest and most admirable man- 
ner, all the complications which can result, either to the 
public or the banks, from errors of calculation or of 
avidity in their stockholders. They have completely 
demonstrated that every excessive issue of notes obliged 
these establishments to hoard money in so much the 
greater proportion as the uneasiness of the holders made 
the run on the banks greater. The necessity of purchas- 
ing specie, in such cases, imposed on the banks sacrifices 
greater than the profit they had realized from the dis- 
counts, and they were often compelled to call back from 
foreign countries, at great expense, the money whose 
exportation had been caused by their excessive issues. 
Europe has witnessed memorable examples of these 
crises of the circulation, within a century: the suspen- 
sion of payments by the bank of England and the ruin 
of the provincial banks in that country, to say nothing 
of the system of Law, and later of the assignats, in ours ; 
an immense revolution, which we will study by itself, be- 
cause of the sober instruction its history furnishes. 

Meanwhile, credit has survived all these tempests, like 
the gunpowder which opens ways through the heart even 
of rocks, in spite of the perils connected with its use. 
When one to-day compares the circulation of paper with 
that of specie, he is convinced that credit has wrought a 
profound revolution in the relations of peoples. Every 
day reveals to us new materials which production takes 
hold of by means of credit, and which credit alone per- 
mits to be sent to the ends of the earth. The colossal 
enterprises of which our century opens the career, the 
spirit of association which extends like a net-work over 
the face of Europe, the struggle everywhere going on be- 
tween civilization and the relics of barbarism, are wholly 
the work of credit ; all come from that idea so fecund 



330 HISTORY OF POLITICAL ECONOMY. 

and so simple which gave birth to banks of circulation 
and principally to the Bank of England. Every man has, 
since that time, been able to carry his head high with the 
pride which the hope of an honorable independence gives. 
Landed proprietors have seen the workshops of industry 
rise by the side of their castles ; the seas are covered 
with ships, and foreign shores with European colonies. 
Everything has advanced with rapid pace, and the world 
has made more progress within two hundred years than 
it did in the previous ten centuries. History bears evi- 
dence that this power of credit will henceforth decide 
finally the great contests of the world ; as witness Hol- 
land, which at last humiliated Louis XIV, and England, 
which sent Napoleon to die at St. Helena. 

The beginnings of this power were, however, very 
modest, even in England, where the first bank of circu- 
lation seemed at its commencement to be modeled after 
those of Venice and Genoa, and was, for a long time, 
only a department of the treasury. In 1694, it lent its 
entire capital to the government and required from it 
interest at eight per cent. ; then, in 1696, doubled this 
very capital; and lent it again, in 1708, after having 
doubled it a second time. In vain its shares lose half 
their value ; in vain its bills suffer a depreciation of 20 
per cent, and temporarily cease to be paid : people never 
grow weary of subscribing to new shares, in spite of the 
enormous depression of the former, because it is the state 
which is the principal debtor of the bank, and because 
the influence of the national guaranty already makes it- 
self felt on the public loans. People soon comprehend 
the importance of such a solidarity, and the public con- 
fidence attaches itself to the fortune of the state as to 
the best anchor of safety. The Bank of England has 
made, since that period, great mistakes, and even one 
day, in 1797, ventured totally to suspend its payments in 
specie, without losing at all its importance, notwithstand- 
ing that declared failure. The nation ratified the decision 



BANK OF ENGLAND. ITS SUSPENSION. 33 1 

of parliament which authorized bankruptcy, and the bank- 
bills, having become paper-money, veritable assignats, 
continued to circulate as if they were still redeemable in 
coin. The government received them in payment of taxes, 
and those were exempt from imprisonment for debt 
who discharged their obligations by means of them. One 
would suppose that from this time these notes would 
have multiplied beyond measure; but the acts* of par- 
liament, and the public prudence restricted their issue to 
wise limits, and England was able for twenty years to do 
without the larger part of her specie, without ceasing 
to be the foremost commercial nation in the world." 

Finally, the famous act of Mr. Peel brought about the 
resumption of specie payments, towards the latter part 
of the year 1819," and five years after, in 1824, it has been 
estimated there were seven hundred companies f organ- 
ized or near being so, with a capital of ten milliards, a 
fourth of which were established, in 1827, with two mil- 
liards five hundred millions. In this short space of time. 
Great Britain had lent to foreigners one milliard two 
hundred and fifty millions of francs. Such are the mar- 
velous effects of credit:]; and its influence on the develop- 

* No limit upon the issue of notes by the Bank of England was prescribed 
by Parliament during the suspension of specie payments. Trans. 

f V. "A complete vie7v of the joint-stock companies formed du-ting the year's 
1824 and 1825," by Henry English. 

\ I have been obliged to confine myself to briefly indicating, here the 
revolution wrought in Europe by the establishment of banks of deposit and 
circulation, and the principal bases on which these banks were founded. All 
the details of their organization have been fully explained in Adam Smith's 
Wealth of Nations, Book ii, chap. 2, and Book iv, chap. 3, ;, in the 4th 
book of Steuart's hivestigation of the Pri^i. of Polit. Econ., and in M. de 
Sismondi's Nezv Principles of Political Economy, vol. ii,, the latter a de- 
clared enemy of banks ; these are the three authors to be read in preference 
on this important subject. M. Storch, J. B. Say, Malthus, and Ricardo 
himself, must have borrowed from them, especially the two former, the fine 
analyses they have given of the functions of banks. To any one who de- 
sires to go deeply into the subject, " The History of Banks," by Mr. Gil- 
bart; the famous pamphlet of Cobbett, entitled, ^' Paper against Gold," a 
true masterpiece of dialectics and financial clearness ; the work of Mr. 
Thornton, " An Inquiry into Public Credit; "and the public investigation by 
the parliament of England on the occasion of the renewal of the privilege 
of the bank, are indispensable documents to consult. The whole science of 
credit is there. One may also consult, but reservedly, the work of Mr, 



332 HISTORY OF POLITICAL ECONOMY. ■ 

ment of production, that, notwithstanding these consid- 
erable exportations of money and the enormous capital 
engaged in mining enterprises, lighting, steam-boats, spin- 
ning mills and forges, England still finds, in our day, 
means to devote five or six hundred millions to her rail- 
roads. She directs the works of peace with as much 
energy as she prosecuted, twenty-five years ago, the works 
'of war. And yet England is the European country which 
has the least metallic money, so that, there at least, one 
might believe that economic adage of Ricardo : " Money 
has arrived at the maximum of perfection, when it is in 
the condition of paper." I do not explain, I relate; be- 
fore believing Ricardo, let us see what Law attempted. 

Joseph de Welz, entitled : La magia del credito svelata {i.e.. The Magic of 
Credit revealed.) 2 vols, in 4to, Naples, 1824. — Note of the Author, 

To these works may be added the Traits th/orique et pratique des opera- 
tions de banque de M. Cou7-celle Seneuil, 3d edit. 1857, and Z?z< Credit et des 
Banques, by Ch. Coquelin, 2d edit. 1859. — Note of French Editor. 

The Theory and Practice of Banking, by H. D. Macleod, and Elements 
of Banking, by the same author (Longmans, Green & Co., London, I876), 
are excellent works on banking,— TVawf. 



CHAPTER XXXI. 

The system of Law. — The circumstances which gave rise to it -Princi. 

pal causes of its failure. — Its influence on the course of political economy. 

At the commencement of the eighteenth century, a 
profound change had been wrought in the political econ- 
omy of Europe. The extraordinary expansion of foreign 
trade and the establishment of the restrictive system had 
concentrated capital on navigation and manufactures. 
We might say that the earth had been abandoned as a 
sterile element, and there was no longer any talk save 
of privileged companies, for trade either in the East- or 
the West-Indies, or for the manufacture of cloths, car- 
pets, or glass. All funds were soon employed in these 
enterprises, because of the favor and profits which mo- 
nopoly assured to them. Every nation, moreover, 
thought that by entering upon the way of tariffs, it 
would protect its products against the competition of its 
neighbors, and find its elevation in their downfall : 
Spain, by means of prohibitions ; England, by excluding 
foreign vessels ; France, by imposing upon them differ- 
ential duties. All the benevolent habits of reciprocity 
had given way to repellent measures, the very image of 
war in the midst of peace. 

To complete the misfortune, wars too real arose from 
these pernicious doctrines, of which the Navigation Act 
and the tariff of 1664 were only the prelude. To the in- 
ternal injury which nations did to themselves by the 
abuse of the protective system, were soon added the 



334 HISTORY OF POLITICAL ECONOMY. 

frightful evils which resulted from an open struggle, 
maintained with equal intensity on either side. We 
have seen what the competition of England and Holland 
produced in this way, and by what catastrophes the last 
years of the reign of Louis XIV were disturbed. The 
finances of all nations were exhausted ; there was no 
longer any capital to carry forward the war, nor to restore 
manufactures. One nation alone, in the midst of these 
disasters, had preserved a proud and indomitable atti- 
tude, as later did the English before Napoleon : this 
was the Dutch ; and they had found resources, next to 
their patriotism, only in their credit. We have shown 
what intelligent views directed the foundation and the 
rapid development of the bank of Amsterdam, notwith- 
standing the limit imposed on its issues of notes by the 
necessity of possessing an equivalent capital in specie. 
Soon the banks of circulation, and especially the bank of 
England, gave a more active impulse to all industries, 
and labor entered upon a new era. 

France alone, among these great nations, had remained 
behind ; and her badly-inspired government had given it- 
self over to the excesses of the Revocation, while England 
and Holland, under the auspices of credit, gave birth to 
marvels. Vauban and Boisguilbert have described in 
pathetic terms the sad diminution of the productive 
power of France in these deplorable times. " There only 
remained to them eyes to weep,'' said they of our fathers ; 
and we are compelled to believe in the reality of their 
misfortunes, confirmed by such high testimony. It was 
in this condition that Louis XIV left our country at his 
death. Up to the last moment, his ministry had lived 
by miserable expedients. It had been reduced to multi- 
plying ridiculous offices in order to obtain money from 
the new titularies; and while England and Holland were 
borrowing at three or four per cent, the farmers of the 
revenue made the king of France pay ten, twenty, and 
even fifty per cent for money. The enormity of the 



THE PUBLIC DEBT. JOHN LAW. 335 

taxes had exhausted the rural districts, which were de- 
prived of their laborers in consequence of the demands 
of war ; commerce had become almost null ; manufac- 
tures, decimated by the proscription of the protestants, 
seemed condemned to lose all the conquests due to the 
genius of Colbert. 

Such was the situation of France when Louis XIV 
died. The public debt amounted then to more than 
three milliards, and bankruptcy seemed imminent. It 
was even proposed to the regent, who nobly rejected the 
proposition, and set himself about establishing a com- 
mission, (the famous commission of the visa), to examine 
the validity of the claims of the various creditors of the 
state. It was at this time that John Law made the 
proposition of a bank of circulation and discount, and 
laid the first foundations of credit in our country. We 
shall be obliged to set forth, at some length, the ideas, . 
so high and so long misunderstood, of this celebrated 
man, who committed the error common to all men of his 
stamp, of being right a hundred years too soon, and of 
dying without being comprehended. His early youth had 
been adventurous, but occupied with special studies on 
public credit in England and Holland, at the source of 
large business negotiations. He had had a near view of 
what activity of circulation can do for a country, and his 
imagination, exaggerating the benefits of credit, had 
made him believe that an abundance of money was the 
principal cause of the wealth of states, since money alone 
brought about the development of their manufactures 
and of their prosperity. This was, in some respects, a 
general opinion in Europe at the time when he lived, and 
contributed not a little to favor the adoption of his views. 
It seemed to him that by assuring to a country the pos- 
session of a quantity of money sufficient to command la- 
bor, it could be made to attain the highest degree of 
wealth and power. Now, banks of circulation allowed 
the place of money to be supplied by credit, which pro- 



33^ HISTORY OF POLITICAL ECONOMY. 

cured for paper the value and utility of coin ; and, as 
there were no limits to the issue of paper money, the pub- 
lic wealth appeared to him henceforth protected against 
all obstructions. 

Such was the error of Law : the exaggeration of a good 
principle. He had taken the effect for the cause, by at- 
tributing to credit results of which credit is only the con- 
sequence. He had not considered that money, whether 
specie or paper, must always be proportioned to the 
quantity of values in way of circulation by exchange, 
and that money could not give rise to manufactures 
among a people, without pre-existing labor. The increase 
of money, without a corresponding increase of exchange- 
able values, would only cause the prices of things to rise, 
instead of increasing the real wealth of a nation. But 
the vast and sure genius of Law had comprehended from 
the beginning the necessity of furnishing capital to la- 
bor, at a low rate. He had observed that private credit, 
that is to say, that of bankers and money-brokers, was 
often injurious to the industrial arts, because of the 
despotic control exercised by lenders over the workers ; 
and he wished to substitute the advances of state credit 
for those of private credit. " Do not forget," said he 
to the regent, " that the introduction of credit has 
brought about a greater change among the powers of 
Europe than the discovery of the Indies ; that it is for 
the sovereign to give it, not to receive it." 

All his ideas, therefore, from the first, turned towards 
the means of securing to the government the direction of 
public credit, by putting into its hands the administration 
of a general bank charged with collecting all the revenues 
of the state, and managing all the monopolies with 
which it should be invested. But, either because theories 
in finance were then comprehended by few people, or be- 
cause the novelty of the project alarmed people's minds, 
Law obtained only the right to establish a private bank, 
exactly similar, in many respects, to the present Bank of 



LAW'S BANK. GOVERNMENT SANCTION. 33/ 

France. Its capital stock was six millions, divided into 
twelve hundred shares of five thousand francs each. This 
bank was authorized to discount bills of exchange, to 
keep accounts with merchants, and to issue bills payable 
to bearer, in coin of the denomination and weight of the 
coin of the day. Scarcely was this bank founded when 
credit appeared again on every side,* confidence gained 
over even foreigners, and usury ceased to exercise its 
ravages. The government added its sanction to that of 
the public, by receiving as specie the notes of Law's 
bank. It was the first trial made in France of this new 
money ; and we may venture to affirm that its use would 
have become general, had it not so quickly degenerated 
into abuse. In fact, so soon as the regent had is^ed the 
edict of April lo, 171 7, which obliged the collectors and 
receivers of taxes to pay the bank-bills in specie, when- 
ever they were presented to them, these bills acquired 
considerable importance ; silver ceased to travel about 
and took refuge in the coffers of the provinces, or in 
those of the bank, to meet the disbursements, which 
were so much the less demanded, as paper was more con- 
venient and of less expensive transportation. The suc- 

* Dutot thus describes, though with some exaggeration, the effects pro- 
duced by Law's bank : 

" Abundance soon spread through the cities and the rural districts : it 
released both from the oppression of debts which poverty had caused to be 
contracted ; it awakened industry, it restored the value of all landed property, 
which had been suspended by those debts ; it made the king able to clear 
away and remit to his subjects more than fifty-two millions of the taxes of 
years previous to 1716, and more than thirty-five millions of duties, ex- 
tinguished during the regency ; it lowered the interest on public funds, it 
crushed out usui-y, it raised the value of lands 80 to loo per cent, it caused 
edifices to be erected in city and country, and the old ones which were fall- 
ing to ruins, to be repaired, lands to be cultivated, values to be given to ma- 
terials derived from the earth, which previously had no value ; it called 
home our citizens whom poverty had forced to go elsewhere for means of 
livelihood ; finally, that abundance attracted foreign wealth : jewels, precious 
stones, and everything that could accompany luxury and magnificence, came 
to us from foreign countries. Whether these prodigies or these marvels were 
produced by art, by confidence, by fear or by chimeras, if one chooses to say 
so, we can but acknowledge that that art, that confidence, that fear, or 
those chimeras had wrought all these realities, which the old administrative 
management would never have produced." — R(/fexio}is politiques stir les fi- 
nances ct sur le commerce de France, vol. i. 



338 HISTORY OF POLITICAL ECONOMY. 

cess was so complete and so decisive, that the bank 
could issue as many as fifty millions of bills with a 
capital of six. The deposits of gold and silver daily 
increased with the demand for bills. They were even 
more in demand than they are to-day, when bank-bills 
have so much difificulty in circulating, as soon as they, 
have crossed the boundary of Paris. 

Thus Law had realized in less than two years the most 
brilliant Utopias of public and private credit. He had ob- 
tained, on an immense scale, results which are still, after 
a hundred years, centered in a few commercial cities ; he 
had reached, at one single stroke, the end of a course which 
would have seemed to require several successive genera- 
tions, it will be to the eternal honor of his memory to 
have organized entirely, without omitting any essential 
wheel, a mechanism so complicated as that of banks of 
circulation, and to have familiarized his contemporaries, 
the victims of so many financial deceptions, with the sys- 
tem of confidence and of bills. Who can tell his joy at 
seeing the prompt success of his work, labor encouraged, 
hope reborn, and France smile on his efforts ! But these 
days of triumph were to be of short duration, and Provi- 
dence had in reserve for him in the very near future cruel 
compensations. We shall profit by them, as by a serious 
lesson worthy to figure in the history of the science. 

The bank of circulation established at Paris no longer 
sufficed for the ambition of Law. He pursued continu- 
ally the first object of his desires, viz., the establishment 
of a national bank, charged with collecting the public 
revenues and exercising the commercial privileges which 
it should please the government to grant it. The possi- 
bility of issuing bills for a sum ten times greater than the 
reserves in specie, seemed to him henceforth too limited. 
He had conceived the idea of combining into one common 
association all the capitalists of France, and putting under 
their control, as a loan,'® all the elements of public wealth, 
from landed property to the uncertain ventures of colo- 



law's bank. west INDIA COMPANY. 339 

nial trade. What could be a finer mortgage than France ! 
And what value such a security would acquire, when the 
credit assured to the most humble proprietor would give 
an unlimited scope for improvements of every kind! 
But Law could not present this project to the public in 
its majestic simplicity ; national confidence was not suf- 
ficiently enlightened to permit it. It was necessary for 
him to graft, so to speak, his universal bank on some in- 
stitution adapted to the prejudices of his contemporaries ; 
and, as misfortune would have it, the mania for coloniza- 
tion, which was then general, afforded him an oppor- 
tunity to found a commercial company on the banks of 
of the Mississippi. Thus was born the West India Com- 
pany, with a capital of one hu.ndred millions, composed 
of two hundred thousand shares of five hundred francs 
each, under form of notes transferable by endorsement. 
To favor realizing from them, Law thought all the stock- 
holders should be authorized, by the edict making the 
grant, (August, 1717), to pay one-fourth of the amount of 
their subscription in specie, and the other three-fourths 
in certificates of rentes, known under the name of billets 
d' Etat (government bills), then greatly depreciated. This 
circumstance gave them some favor, and sensibly raised 
public credit ; but the safety of the enterprise really de- 
pended on the success of the colonial trade of the com- 
pany ; and, however credulous contemporaries may have 
been, the dividends were in fact never derived from any 
other source than from the interest of the billets d' Etat, 
paid by the government to the shareholders. Soon a 
formidable opposition, arising from parliament, pre- 
tended to contest the right of the new bank to collect 
taxes and make public payments, and the treasury 
clerks were forbidden to pay specie for the notes which 
should be presented. A lit de justice {i.e., a sitting of 
the parliament of Paris in the king's presence — Trans) 
was necessary to restore order, to say nothing of the 
competition of the Paris brothers, who organized the 



340 HISTORY OF POLITICAL ECONOMY. 

anti-system,'^ under the influence of the parliamentary- 
party. 

Finally, December 4, 171 8, two years and a half after 
its foundation, the bank of Law was declared a royal 
bank, and the capital was paid back to the stockholders. 
The king took upon himself henceforth the responsibility 
for the security of the notes, the issue of which amounted 
in a few months to more than the capital of the previous 
bank. Unfortunately, in order to give credit to the new 
bills. Law thought it necessary to obtain of the regent an 
edict forbidding the transportation of money between 
the cities where the bank ofifices were. This was giving 
a forced currency to his paper money ; and this was not 
the only error of Law. It was in his destiny to import 
into France, with the most useful employment of credit, 
the most disastrous of its abuses, agiotage, {i.e., specula- 
tions on the rise and fall of public funds — Traits.). Th( 
agiotage arose from the relations of the royal bank with 
the West India Company. The shares of this company 
having fallen considerably. Law, who wished to maintain ' 
them, engaged to buy them below par at a given time, 
and to pay a premium equal to the difference between 
the market-price and their par value. Everybody wished 
to run the chance of the profit which would result from 
it, and the shares rose. They rose still more when Law, 
being in favor with the regent, had caused the monopoly 
of the East Indies to be added to the privileges of the 
West India Company, with authority to issue new capi- 
tal sufficient for that association. Well-managed con- 
trivances, because they were new, made specie flow into 
the coffers of the Scotch innovator. He gave time to 
the stockholders to pay the amount of their shares, with- 

* The name anti-system was given, from its opposition to the ideas of 
Law, known under the name of the system, to the association formed by 
four brothers named Paris, from Grenoble, to break down the bank of Law 
by means of a capital of a hundred millions, the niterest of which, being 
better secured than that of the bank, would naturally make the shares of the 
latter fall. 



RECOINAGE. RISE OF LAW'S SHARES. 34I 

out dreaming that time would be lacking to him to com- 
plete his work, and that he would soon be reproached 
with the ruin of the country; he gave them time, of 
which the Americans of our day have the saying, " Time 
is money." The speculators bought at once shares and 
expectations; and Law redoubled his efforts to give 
value to both. The silver, great quantities of which 
were poured into the coffers of the state, inspired in 
him the idea of a recoinage of the money. He caused 
the exclusive privilege of coining it to be accorded him 
by an edict, which favor cost the bank fifty millions. Then 
began those reciprocal concessions between the govern- 
ment and the system, the former always granting and the 
latter constantly promising, with the same want of reflec- 
tion and the same heedlessness of the future. There were, 
however, enormous advantages obtained by the recoinage, 
and if the India Company had furnished its part of the 
dividends, the royal bank would have been established on 
impregnable foundations. The avidity of courtiers and 
the folly of speculators decided the matter otherwise. 

The shares had already risen to a rate which neither 
the securities offered by the company, nor even the most 
exaggerated chances of profit, justified. Operations 
were no longer anything but gambling ; and their history 
is too well known to enter into its details here. Sufifice 
it to say, the rise of shares improvised fortunes truly 
fabulous, and brought about, in property, changes which 
were not without advantage to the general prosperity of 
the country. The landed aristocracy, weary of possess- 
ing lands whose modest incomes could not be compared 
with the dazzling products of agiotage, exchanged their 
meadows and woods for shares; wages rose to a rate 
hitherto unknown, and the merchandise which encum- 
bered the stores could not sui^ce for the eager haste of 
buyers. Law seemed to have attained the consummation 
of his desires. If any badly-inspired rivals bought his 
notes, to make him uneasy by loud demands for their re- 



342 HISTORY OF POLITICAL ECONOMY. 

demption in coin, he caused an edict to be issued which 
reduced the value of specie, and he disconcerted coali- 
tions by the boldness of his alliance with the government. 
Never, we must say, have bolder experiments been made 
with such promptitude and on such a scale ; never have 
theories more adventurous had at their service a power 
more absolute. There remained only one last attempt, 
the most dangerous, it is true, but the most seductive of 
all ; namely, the payment of the public debt. This would 
meet with fewer obstacles than any other, on the part of 
the regent ; but it had the defect of being executed with- 
out precaution and in a premature manner. Fifteen 
hundred millions could not be thus lightly displaced in a 
country less accustomed to the vast operations of credit 
than England and Holland. It was also hazarding much 
to substitute the shares of the India Company for the 
titles of state creditors, and to make the latter barter off 
as people said in those times, their certificates of rentes, 
{i.e., public funds) for the fogs of the Mississippi. 
Nevertheless, the measure could have succeeded but for 
the fury with which people rushed into the speculations 
of which it became the signal. The shares, almost as 
soon as issued, rose to three, four, and even ten times 
their nominal value. One would have said that the 
French were at a loss where to invest their money, so 
eager were they to obtain at any price titles to the new 
loan. The second issue resulted in one hundred thou- 
sand shares of five hundred francs, realizing at five 
thousand livres. There was a general frenzy, encouraged 
besides by the latitude accorded to subscribers to dis- 
charge the debt by ten monthly payments. It was suffi- 
cient to give earnest money, as M. Thiers* so ingeniously 
says, to secure ten shares instead of one. The creditors 
of the state were not the last to lend themselves to their 
own spoliation ; and the history of the system is full of 
the brigandage which worthily opened the career of 
agiotage in our country, 

* Article on La%o, in L Encyclopedic Progressive, p. 80. 



. WILD SPECULATIONS IN SHARES. 343 

We can here only briefly state the results of that great 
financial revolution, which caused great evils, like all rev- 
olutions, but which also produced great permanent bless- 
ings, in compensation for passing evils. Public morals, 
principally, received some rude shocks, too capable of 
turning worthy people from the long and thorny path of 
labor. " The variations of fortunes were so rapid," says 
M. Thiers,* " that stock-jobbers, receiving shares to sell, 
by keeping them one single day, had time to make enor- 
mous profits. A story is told of one, who, charged 
with selling some shares, did not appear for two days. 
It was thought the shares were stolen : not at all ; 
he faithfully returned their value ; but he had taken 
time to win a million for himself. This power which capi- 
tal had of producing so rapidly, had brought about a 
traffic ; people lent tJie funds by the hour, and exacted un- 
precedented rates of interest. The stock-jobbers found, 
moreover, a way to pay the interest demanded, and to 
reap a profit themselves. One could even gain a million 
a day. It is not then astonishing that valets became 
suddenly as rich as lords ; one is mentioned, who, meeting 
his master in bad weather, stopped his carriage and pro- 
posed to enter it." The folly went so far, that shares 
rose to thirty times the capital, and speculations in public 
funds absorbed, as a gulf, all the savings of rich and poor, 
in less than a few months. There were soon not enough 
gold and silver laces at the stores to deck the new aristoc- 
racy which sprang from this effervescence of the purse ; 
and the six hundred thousand shares of the India Com- 
pany came to represent more than ten imaginary mil- 
liards. One should have been a witness of some financial 
infatuations of the present time, to have an idea of the 
delirium of the time of Law, and the complete blindness 
into which the mania for speculation had plunged the 
most reasonable people. 

Meanwhile, the moment of the crisis was approaching, 
*Article Law, previously quoted. 



344 HISTORY OF POLITICAL ECONOMY. 

without any one daring to prophesy it, not even Law 
himself, who seemed to believe in an indefinite duration 
of his system. There was no longer any security possi- 
ble for a capital carried up to more than ten milliards ; 
and even if the Mississippi had been a veritable Eldorado, 
four hundred millions would have hardly sufficed to in- 
sure an interest of four or five per cent on the ideal fig- 
ure of the shares. It was soon necessary to impose by 
authority a multitude of measures which should have 
been the result of confidence ; and from this moment 
confidence was shaken. Law supposed the bank notes 
could be sustained by edicts which forbade their conver- 
sion, at Paris, into gold and silver ; then he caused an 
order to be issued that taxes" should be paid in bills ; and, 
finally, that creditors should have, the right to demand 
also, in bills, the payment of their dues. But these vain 
expedients only hastened the consummation of the catas- 
trophe. The most prudent were eager to realize, i.e., to 
convert into lands, furniture and houses, the amount of 
their shares or their notes ; and then was seen a phe- 
nomenon just the contrary of that already described, the 
bearers of effects running after all the solid values, while 
previously they seemed only too happy to get rid of these 
values to have stocks. Prices rose almost suddenly to a 
rate hitherto unknown, and the run upon the bank to ob- 
tain redemption of the notes in specie daily increased. 
An attempt was made to provide against this danger by 
giving forced currency to the bills, and announcing, in 
order to maintain the wavering confidence, dividends 
which could not be paid. Then came senseless meas- 
ures : a prohibition against wearing gems and diamonds, 
lest people should buy them in exchange for bank-bills ; 
the confiscation of old specie and domiciliary visits for 
the purpose of discovering it. The decline in the shares 
went on, nevertheless, rapidly, to the great despair of the 
unfortunates who had exchanged real estate for fictitious 
wealth, and amid the noisy saturnalia of all the newly- 



BANKRUPTCY. CAUSE OF FAILURE. 345 

enriched, who had consolidated their fortune by purchases 
of land or by investments in foreign countries. The fa- 
mous edict of March 5, 1720, completed that structure 
of violent measures, which has brought upon the system 
of Law the somewhat biased censure of posterity. This 
edict, assimilating, by astute combinations, the bank-bills 
with the shares of the India Company, that is, values ob- 
tained in exchange for serious titles, with values emi- 
nently .fictitious and speculative, was a veritable bank- 
ruptcy, which no historian has attempted to conceal. It 
is difficult for us to-day to comprehend to what sad expe- 
dients Law felt obliged to descend, after this last stroke. 
The desperate edicts he caused to be issued, recall some 
of the measures of the terror of 1793,* and included the 
informing against possessors of gold and silver, and the 
perturbation of the monetary system. Science has noth- 
ing to do with these aberrations of a man of genius at 
bay, except to regret that he was brought to them, so to 
speak, in spite of himself, by the necessity laid upon him, 
of subordinating his operations to the exigencies of the 
court and the distressed condition of the finances. 

Dutot, Forbonnais, Steuart and M. Thiers f have given 
a complete exposition of the last days of the system and 
the false combinations which determined its fall, I.t is 
now certain that the bank of Law would have rendered 
immense service to France, if the regent had not made of 
it an instrument for collecting taxes, a docile financial 
machine, instead of leaving to it the independence of a 
commercial institution. When we reflect that this bank, 

* It was forbidden to keep more than four or five hundred francs in specie, 
under penalty of a fine of ten thousand francs. Nothing made of gold was 
to weigh over an ounce. The weight was fixed for all articles made by gold- 
smiths, as dishes, sugar bowls, and candlesticks. The ridiculous vied here 
with the odious. 

f Reflexions politiques stir les finances et le commerce ; Recherches sur les 
finances de France ; Recherches des principes de V ^conomie politique ; article 
Laiv, already quoted. — Note of author. 

The principal writings of Law have been inserted in the first volume of 
the Collection des Economistes , of Guillaumin, with Notice historique sur 
Jean Law, ses dcrits et les operations du systhme, by Eugene Daire. — Fr. ed. 



346 HISTORY OF POLITICAL ECONOMY. 

established with a view to giving activity to the circula- 
tion, had come to the point of interdicting the circulation 
of gold and changing the values of coins, it is dif^cult to 
reconcile such an end with the prosperous beginning 
which permitted no one to foresee it. From May 21, 
1721, the shares of the India Company and the notes of 
the royal bank were gradually reduced : this was decree- 
ing bankruptcy, m place of waiting for it and submitting 
to it ; it was saying to the creditors of the government 
that they had been dishonorably deceived, and that now 
their eyes were being audaciously opened. But the pub- 
lic reaped, in truth, what they had sown. Was it not they 
who had caused the prices of shares to rise to an exag- 
gerated figure, and who had thus artificially increased 
their value, so as to render impossible the payment of in- 
terest proportionate to a capital so enormous ! There 
happened to the bank of Law the same thing that was 
seen in America, at the time of the crisis which recently 
agitated that country. Most of the banks were ruined 
through having multiplied their issues too largely ; that 
is to say, through having speculated too much on the 
rise of lands and on the progress of a civilization which 
can advance only with the step of man. From whatever 
point of view one looks at the system, he will be con- 
vinced that if Law had remained faithful to the true 
principles of credit which he had so well developed in 
his Considerations on Money,''' he would have raised 
France, a hundred years ago, to the first rank among 
financial powers, and perhaps prevented the terrible 
catastrophes by which the latter part of the eighteenth 
century was agitated. He is the only one, since the 
existence of banks, who has been able to put with im- 
punity ten times as many notes in circulation as the 
specie capital his bank contained ; and, notwithstanding 

*In this writing, translated into French, and reprinted in 1790, Law ex- 
plained clearly his ideas on credit. Many economists have obtained from it 
useful information, without rendering its author the justice due him. — Note 
of author. 



ERRORS OF LAW'S SYSTEM. 347 

the imprudence of his conduct in reference to the India 
Company, he nevertheless has the honor of having been 
the first to create industrial values in France. 

This single creation was a high and grand thought. 
The smallest capital henceforth found investment, and 
workers hitherto condemned to the uncertainty of wages, 
were henceforth admitted to the privileges of property. 
The shares of the bank and of the India Company offered 
to economical persons the advantages of a savings bank, 
with the chances of profit of a great commercial associa- 
tion. The conception of Law seems to us admirable in 
this respect. Public credit was substituted for private 
credit. The interest of money fell to the lowest rate ; 
and consequently the most efficacious cause of inequality 
of conditions disappeared. Unfortunately, the Scotch 
financier shared the error common to several of his most 
illustrious contemporaries, in supposing that all that was 
needed to make the interest on money diminish, was to 
multiply the money ; and he aggravated that error by 
the still greater and wholly personal error of believing 
that one could multiply paper-money (bank-bills) without 
having regard to the capital held for its redemption. The 
event favored his illusion longer than seemed possible ; 
for we have seen that the advantages of paper were so 
well comprehended in France, that Law could risk, even 
at the commencement of his operations, what no bank of 
discount would dare attempt to-day, viz., an issue of 
notes ten times greater than the specie capital. Confi- 
dence was general ; the error of Law lay in the abuse of 
it. The regent led him into this by degrees, in the inten- 
tion of paying off the national debt ; and he. forced him, 
to use the expression of a contemporary,* " to raise seven 
stories on foundations that he had laid for only three." 
The true effects of the system are scarcely well known to 
us at present. The writers of the time all speak of it 
with that affectation of horror which too often pursues 
* Dutot. 



348 HISTORY OF POLITICAL ECONOMY. 

the greatest reputations, when the hand of misfortune is 
laid upon them. " On giving up this game," says Le- 
montey,* " the lucky players had too much interest in 
concealing their gains, and the unfortunate ones in exag- 
gerating their losses. Those who judged of this compli- ■ 
cated crisis were liable to confound the violence of the 
remedy with that of the evil, and what had only been dis- 
placed with what was destroyed. * * * Meanwhile the 
central provinces, where civilization was the most back- 
ward, experienced a salutary disturbance. These poor 
and sluggish districts, where trade and money were scarce- 
ly known, and the fruits of the earth were without value, 
and the collection of the taxes as distressing as it was un- 
productive, became animated with new life. In respect 
to wealth, the price of provisions, the amount of the 
taxes, social life and political importance, the new birth 
of this vast territory dates from the cataclysm of Law ; 
and its progressive civilization, since 1720, is a better 
monument of it than the bank-bills still kept in some cot- 
tages." 

The principal cause of the fall of the system was, then, 
the excessive issue of bank-bills and shares in the India 
Company. Fictitious capital was powerless to supply real 
interest ; the result was only an exaggerated rise of the 
prices of all things and a general change of fortunes, so 
much the more dangerous as it was rapid. Similar catas- 
trophes have since marked the same abuses of credit in 
the old and the new world Our fathers saw the assi- 
gnats, when multiplied beyond measure, fall with a crash, 
in spite of the guaranty of the wealth called national ; 
England, in her turn, experienced a great monetary 
crisis, for having exceeded the natural limit of specie in 
the loans of her bank to her government. At the time I 
am writing, a crisis more serious still has just deranged 
all the circulation in the United States,t and one can be- 

*Histoire de la Rdgence, vol. i, p. 356. 

•j-The author alludes to the crisis of 1838-9. — Fr. ed. 



CREDIT. DIVISION OF LANDS. 349 

lieve himself transported back to the time of Law, when 
he studies the causes of that disturbance, which are al- 
most identical with those of the fall of the system. In 
vain the Convention punishes with death the refusal of 
the paper money ; in vain the parliament of England au- 
thorizes the failure of the bank, and the United States 
precipitate the bankruptcy of theirs ; these formidable 
attacks only strengthen the fundamental bases of the 
theory of credit.* Credit should represent only solid 
values, and solidity of values can be increased only by 
confidence, but can never be decreed by force. If Law 
had been free in his operations, he would have restricted 
his issues of bills and shares within the limits indicated 
by the wants of the circulation and the probable revenues 
of the India Company. His first successes were dazzling. 
He conceived that he could reduce all France to small 
money and make all the land circulate under the form of 
paper. However, the effect he obtained from that gigan- 
tic attempt, was not without fruit. The innumerable 
. changes which were wrought under the influence of the 
system, began the dividing up of landed property, from 
which France has derived so great advantages. The 
spirit of enterprise seized all classes of society, and the 
power of association, hitherto unknown, revealed itself 
by new and bold combinations of which our present op- 
erations in credit are only imitations. Had it not been 
for the prodigalities of the court, the public debt would 
have been considerably reduced by the reimbursement 
of a part of the creditors of the state, and the lowering of 
the interest would have soon permitted the rest to^ be 
paid. 

Landed property came forth for the first time fro^m the 
state of torpor in which the feudal system had so long 
kept it. It was a real awakening to agriculture, and land 
rose from this time to the rank of a productive power. 

* The reader who desires a philosophical exposition of the subject of 
credit, should consult H. D. Macleod's Economic Philosophy^. voL i. chaps., 
viiand viii, and vol. 2, chap, xii, pp. 62-64. — Trans^ 



350 HISTORY OF POLITICAL ECONOMY. 

It had just passed from the regime of mortmain to that 
of circulation. The new proprietors, almost all of whom 
had sprung from the ranks of the workers, cultivated the 
land with all their customary ardor and with the ease 
which abundance of capital gave them. The storm, too, 
which had just overwhelmed it, seemed only to have 
given it new vigor, and from that time a new era began 
for it. Everybody clung to it as the most stable of 
values ; so that, despite the disappointments experienced 
by the other branches o£ industry during the breaking up 
of the system^ a new system almost immediately succeed- 
ed that which had just become extinct, and cast also a 
brilliant light before passing away, like the other. It will 
be readily divined that we refer to the system of Ques- 
nay or of the Economists, 



CHAPTER XXXII. 

The system of Quesnay and the Economist school. — Origin of its doc- 
trines. — Services they rendered. — Various shades of the Economist school. — 
Gournay. — Mercier de la Riviere. — Turgot. — Admirable probity of these 
philosophers. — Details about Quesnay. 

The sad issue of Law's system left all France plunged 
in a veritable stupor. People no longer knew upon what 
principles to rely, after having seen so many fortunes 
rapidly come and go. Some deplored the ruin of the 
manufactures founded with so much effort by Colbert; 
others went back a hundred years and recalled the patri- 
archal maxim of Sully ; " Tillage and pasturage are the 
breasts of the state;" and we must acknowledge that 
circumstances had become very favorable for a return to 
these ideas. Of all the industrial values produced under 
the hot atmosphere of the system, nothing remained but 
ruin, desolation and bankruptcy. Landed property alone 
had not perished in that tempest. It had even improved 
by change of hands, and by being subdivided on a vast 
scale, for the first time, perhaps, since the feudal system. 
The importance that it thus acquired all at once, in- 
creased its value considerably ; and soon the activity of 
minds freed from speculative illusions, was directed to- 
ward the cultivation of the soil, to demand from it repa- 
ration for the misfortunes of the system. One might say 
that every man felt the need of rest in the shadow of his 
own vine and fig-tree from the shocks and agitations of 
the Bourse. 

Never was transition more sudden. People went on, 

351 



352 HISTORY OF POLITICAL ECONOMY. 

however, through a mass of books. There was a shower 
of writings on the circulation, on credit, on industrial arts, 
on population, on luxury : every one seemed to wish to 
explain the crisis from which people were emerging, and 
thought he had found, for his consolation, the key of that 
enigma. People had for some time deemed money to be 
wealth in an especial sense, and thought that in multiply, 
ing the paper which represented it, they were multiplying 
wealth itself. But the general rise in prices and the fall 
of the paper had unsealed the blindest eyes, and as is usual 
in similar circumstances, they had passed from infatuation 
to aversion, from fanaticism to incredulity. There were 
henceforth no true riches but land, and no secure revenues 
but those which emanated from its bosom. It was from 
this reaction that the agricultural system arose, better 
known under the name of the Economists, or of Quesnay, 
who was its principal founder. It was also the first sys- 
tem which constituted a school, and it stated its formulas 
with a dogmatic precision quite rare in the annals of sci- 
ence. We will make a simple summary of it, a3 to per- 
sons and things. If it had been only an exposition of 
doctrines purely economic, it would not, perhaps, have 
obtained so high a degree of attention from statesmen ; 
but it presented itself from the very first as the instru- 
ment of a political reform, which was to facilitate the 
collection of taxes and repair the evils with which France 
was afflicted. It came after the disasters of Law and 
the somewhat crude attempts of the abbe Terray * in mat- 
ters of finance ; it was received with favor as a novelty, 
while waiting to establish itself by right of conquest. 

And truly its first manifestoes appeared like a revela- 
tion. Every nation had, in turn, extolled the power of 
manufactures and freedom of trade : none seemed to 
have thought of agriculture, except from an exclusively 

* The abbe Terray was not as absurd and as pitiless as most of his con- 
temporaries have pretended. He one day responded to some opera singers 
v/ho were claiming their arrears, " It is just to pay those who weep before 
those who sing." 



AGRICULTURE. NET PRODUCT. 353 

pastoral point of view. Not one had had the idea that 
the government should occupy itself with the cultivation 
of the fields, and take any administrative measures rela- 
tive to such labors. All that had been done until then of 
this kind consisted in bad regulations against the exporta- 
tion of grain, or to prevent its importation, like the corn- 
laws of England. And nevertheless, agriculture was 
always considered, by a sort of poetic tradition, as the 
nursing mother of the people. About the year 1750, 
two men of great grasp of mind, M. de Gournay and 
Quesnay, attempted the analysis of that fecund power; 
instead of extolling it, they explained it. They ravished 
from the earth her mysterious processes, and if they did 
not give the best theory about them, they at least pre- 
pared its elements for posterity. 

Their starting point was admirably chosen. They 
attempted first to establish the true principles of the 
formation of wealth and of its natural distribution among 
the different classes of society. It seemed to them that 
all wealth proceeded from a single source, which was 
the earth, since this it was which furnished the laborers 
their subsistence and the raw materials for all branches 
of industry. Labor, applied to the cultivation of the 
earth, produced not only means of support during the 
progress of the work, but an excess of value which could 
be added to the mass of wealth already existing : they 
called this excess the net product. The net product must 
necessarily belong to the proprietor of the land and con- 
stituted in his hands a revenue at his disposal. What 
then was the net product of the other occupations ? Here 
begin the errors of these ingenious men, for in their 
eyes the other branches of industry were unproductive, 
and could add nothing either to the mass of things upon 
which they worked, nor to the general revenue of society. 
Manufacturers, traders, workmen, were all paid clerks of 
agriculture, which was the sovereign creator and dis- 
penser of all wealth. The products of their labor repre- 



354 HISTORY OF POLITICAL ECONOMY. 

sented, in the system of the Economists^ only the equiva- 
lent of their consumption during the work, so that after 
the labor was finished, the sum total of wealth was abso- 
lutely the same as before, unless the workmen had put 
in reserve, that is, saved, what they had a right to con- 
sume. Thus, then, labor applied to land was the only 
labor productive of wealth, and that of the other branches 
of industry was considered as sterile, because no aug- 
mentation of the general capital resulted from it. 

In virtue of this system, the Economists admired as a 
necessity at the same time social and natural, the pre- 
eminence of landed proprietors over all other classes of 
citizens. These proprietors reaped the total of the wealth 
produced, of which they distributed a portion, under 
the name of wages, to the non-proprietors ; and the cir- 
culation of wealth took place, in society, only by the 
continual exchange of the labor and services of some for 
the disposable portion of the income of the others. What 
became, on that hypothesis, for it is to-day no longer any- 
thing but an hypothesis, the basis of taxation? It was 
evident that taxes could not be assessed on people re- 
duced to wages, without attacking the source of their 
existence : besides, the Economists declared that the tax 
must be exclusively borne by the proprietors of lands, 
and deducted from the net product. It was consequently 
the general interest of all classes to multiply agricultural 
products, because the proprietors found thereby a larger 
income to distribute to all the wage-paid occupations. The 
population was encouraged and increased by abundance 
of means of subsistence, and thus was verified the maxim 
borrowed by the new school from the holy books : "He 
that tilleth his land, shall be satisfied with bread."* 

We need not say wherein the Economists were mistaken. 
Their principal error arose from their attributing to agri- 
culture alone the power of creating products susceptible 
of accumulation. The fine analyses of Adam Smith have 

* Prov. 12 : xi. 



ERROR OF THE ECONOMISTS. 355 

completed, since then, the catalogue of the sources of 
wealth, by demonstrating that the real social value is ex- 
change value, and that there is profit to society, when- 
ever that value is increased by labor. Grain would be of 
. very little utility if some one did not make bread of it, 
and wood would not have great value if the joiner and 
the cabinet-maker did not transform it into furniture. 
Experience has proven, also, that manufactures and com- 
merce are much more favorable than agriculture to the 
increase of exchange value, either from the division of 
labor being better adapted to that end, or on account of 
the perfection of the machines. How would cities have 
become the centres of wealth and civilization, if agricul- 
ture alone had the gift of creating values? and how could 
we explain the fortune of Venice and of Genoa, which 
had no territory? Is it not rather because, by means of 
commerce and manufactures, a country can import an- 
nually a quantity of means of subsistence much greater 
than its own lands could furnish it ? The theory of open- 
ings for trade [debotiche's), so well developed, since the 
Economists^ by J- B. Say, has put that truth in a clear 
light and worthily completed what Adam Smith, the 
master of us all, so well begun. But what light did 
the brave theses of the Economist school throw upon 
this grave question ! What immense consequences we 
have derived from that very simple proposition that the 
wealth of nations does not consist in wealth that can- 
not be consumed, such as gold and silver,* but in 

* This proposition is clearly expressed in the following passage from 
Mercier de la Riviere : 

" Let me be permitted to repeat here that money does not rain down into 
our hands, does not grow in our fields, in nature. To have money, we must 
buy it ; and, after that purchase, one is no richer than he was before : he 
only receives in money, a value equal to that he has given in merchandise. 
An agricultural nation is very rich, people tell us, when we see much money 
there ; people are doubtless right in saying so, but they are wrong not to see 
also that before acquiring that money, it was equally rich, since it possessed 
the values with wliich it paid for the money ; it cannot even enjoy that 
wealth in money without making it forever disappear, unless it maintains it 
by the reproduction of the values whose sale, or rather exchange, have pro- 
cured for it money wealth : so this wealth in money is only a secondary 
wealth representative of a primary wealth for which it is substituted." {Ordre 
Naturel et Essentiel des Societes PoUiiques. Vol. ii, p. 338.) 



356 HISTORY OF POLITICAL ECONOMY. 

consumable wealth produced by the incessant labor of 
society ! 

To complete their good fortune, the Economists, con- 
sidering the subordinate condition and the inferiority of 
the non-property-holding classes, as they appeared to 
them in their system, thought nothing more just than to 
claim for them absolute freedom of manufactures and 
commerce. A good market for provisions and an abun- 
dance of raw products could be assured them only by the 
unlimited competition of the sellers. This competition 
was the sole means of stimulating industrial enterprises, 
and of favoring the cultivation of the earth by removing 
all restrictions; a doctrine which the new school summed 
up in these memorable words, so badly interpreted since : 
Laissez /aire, laissez passer. It was from this time that 
most of the barriers which arrested the development of 
agriculture were broken down, and a general war com- 
menced against corporations and customs, those two 
fortresses of privilege, which contain them all within 
their walls ! The Economist school rendered other ser- 
vices equally important, by analyzing the principal phe- 
nomena of the distribution of wealth. For this end 
principally Dr. Quesnay, physician of Louis XIV, and 
chief of that school, published his fam'ous Tableatt Econo- 
mique, so heavily commented upon in U Ami des Hommes 
by the Marquis de Mirabeau, and reproduced in the 
Physiocratie'' of Dupont of Nemours. 

This Economic Table, of which the first proofs were 
printed at Versailles, from the very hand of the king, 
with this epigraph : Poor peasants, poor kingdom ; poor 
kingdom, poor king, presented a series of formulas bris- 
tling with figures, in which the author indicated such a 
distribution of the territorial revenue, as seemed to him to 
result from the general laws of production. This was the 
part which, of all the system, was most talked of, and 
which is to-day the most forgotten, because founded on 
bases recognized as erroneous. Nothing can depict the 



TABLEAU fiCONOMIQUE. 357 

enthusiasm which its pubhcation aroused among all the 
adepts of the sect. Dupont of Nemours, called it " that 
astonishing formula which depicts the origin, the distri- 
bution and the reproduction of wealth, and which serves 
for calculating with so much certainty, promptitude and 
precision, the effect of all the operations relating to 
wealth." Mirabeau added : " There are three marvellous 
inventions in the world, writing, money and the Tableau 
EconomiqueJ' This tableau was commented on, amplified 
and developed by all the adepts, with the same assur- 
ance as the theorems of geometry in our colleges. It 
was learned by heart as a sort of catechism, in which 
every class of citizens should study the duties they had 
to fulfil in the social hierarchy Now that we no longer 
consider those occupations as unproductive of which the 
author spoke, their more or less ingenious classification 
has no farther interest to science. 

The dominant thought of the Economist school is re- 
vealed more fully in the little work of Quesnay, repub- 
lished under the title of General Maxims for the Economic 
Government of an Agricultural Kingdom. Here are ex- 
pressed more clearly the political views of that school, 
which has been accused, with some ground, of a system- 
atic tendency toward an absolute government. We will 
quote a few of these maxims, isolated, as they are in the 
original work, under the form of aphorisms. 

" Let the sovereign authority be single, and superior to all the individuals 
of society and all the unjust enterprises of private interests ; for the object 
of domination and obedience is the security of all and the lawful interest of 
all. The system of counter-forces in government is a harmful one, which 
only produces discord among the great and the oppression of the weak." 

" Let the sovereign and the nation never lose sight of the fact, that the 
earth is the only source of wealth, and that it is agriculture that multiplies 
it. ■ For the increase of wealth insures that of population ; men and the rich 
make agriculture prosper, extend commerce, animate manufactures, and in- 
crease and perpetuate wealth." 

" Let the tax not be destructive, nor disproportioned to the total revenue 
of the nation ; let its increase follow the increase of the revenue ; let it be 
assessed directly on the net product of the landed property, and not on the 
wages of men, nor on provisions, where it would multiply the expenses of 
collection, be prejudicial to commerce, and destroy annually a part of the 
wealth of the nation. Neither let it be taken from the wealth of the farmers 



358 HISTORY OF POLITICAL ECONOMY. 

of landed property, for the advances of the agriculture of a kingdom must 
be looked upon as fixed property, which must b# carefully preserved for the 
production of the impost, the revenue, and the subsistence of all classes of 
citizens : otherwise the tax degenerates into spoliation, and causes a dwin- 
dling away which quickly ruins a state." 

" Let the lands appropriated to the cultivation of grain be combined, 
as much as possible, into large farms worked by wealthy farmers ; for 
there is much less outlay for keeping and repairing buildings, and much less 
expense and much greater net profit proportionately in great agricultural 
enterprises than in small ones. A multiplicity of small farmers is prejudicial 
to the population. The population the most secure, ihe most disposable for 
the different labors which divide men into different classes, is that which is 
supported from the net product. Every saving made to increase this, by 
labors which can be executed by means of animals, machines, rivers, etc., 
reverts to the benefit of the population of the state, because more net product 
procures more gain to men for other services or other labors." 

" Let openings for the sale and transportation of the products of manual 
labor be facilitated by the repair of the roads, and by navigation on the 
canals, rivers, and sea ; because the more that is saved in the expenses of 
commerce, the more the revenue of the territory is increased." 

" Let not the comfort of the lower classes of the citizens be diminished, 
for they would not be able to contribute to the consumption of such pro- 
visions as can be consumed only within the country, which would diminish 
reproduction and the revenue of the nation." 

" Let land-owners and those persons who have lucrative occupations not 
indulge in unprofitable hoarding, for this would take from the circulation 
and distribution a part of their income or gains." 

" Let no one be deceived by an apparent advantage of reciprocal trade 
with foreign countries, by judging simply by the balance of the sums in 
money, without examining the more or less profit resulting from the mer- 
chandise that is sold and that which is purchased. For often the loss is to 
the nation which receives a surplus in money, and that loss occurs to the 
disadvantage of the distribution and reproduction of the revenues." 

" Let entire freedom of trade be maintained ; for the regulation of the in- 
ternal and the foreign trade, which is the most secure, the most exact, and 
the most profitable for a nation and a state, consists in full liberty of com- 
petition." 

"Let the government be less occupied with the matter of saving than 
with the operations necessary to the prosperity of the kingdom ; for very 
great expenses may cease to be excessive by the increase of wealth. But 
we need not confound abuses with simple expenses, for abuses might 
swallow up all the wealth of the nation and of the sovereign." 

" Let no one hope for resources of extraordinary advantage to a state, 
except from the prosperity of the nation, and not from the credit of finan- 
ciers ; for pecuniary fortunes are clandestine riches which know neither king 
nor country." 

" Let the state avoid loans which form government funds, for they load it 
with devouring debts, and occasion a commerce or traffic in money, through 
the intervention of negotiable paper, where discount increases more and 
more the unproductiveness of pecuniary fortunes. These fortunes separate 
finance from agriculture, and deprive the rural districts of the wealth 
necessary for the improvement of real estate and the cultivation of the land." 

The above maxims belong especially, as one can see, 
to political order. The author seems to be concerned 
only with the payment of imposts, with population, loans, 



DOCTRINES OF LA RIVIERE. BAUDEAU. 359 

and public expenditures. In fact, the Econo^nists looked 
at the science differently from us, and almost exclusively 
in its connection with administration and government. 
Their aim was to found a social theory and to subject 
all minds to the yoke of a tutelary authority, much like 
a despotism. They wished first of all to settle landed 
property, which seemed to them the most important of 
all, on an immutable basis ; but they nevertheless re- 
spected personal property, and they admitted no duties 
without rights, nor services without compensation. The 
interest of the sovereign was naturally, in their view, the 
same as that of the people ; a king was only a father of a 
family. They took pleasure in representing Louis XV 
as animating agriculture with his presence and diffusing 
abundance and peace along his pathway. Mercier de la 
Rivifere even ventured to write : ** It is physically impos- 
sible that any other government can last than that of 
a single person. Who does not see, who does not feel, 
that man is formed to be governed by despotic authority? " 
" — Because man is destined to live in society, he is des- 
tined to live under a despotism." — " This form of govern- 
ment is the only one which can procure for society its 
best possible condition." * 

The abb^ Baudeau, one of the most able interpreters 
of the new school, shared the opinions of Mercier de la 
Riviere. He thought, like him, that it was easier to per- 
suade a prince than a nation, and that the triumph of tJie 
true principles would be sooner secured by the sovereign 
power of a single man, than by the conviction, difficult 
to obtain, of an entire people. As chance would have 
it, they found among their contemporaries more than 
one of these reform princes : the Empress Catherine of 
Russia, Emperor Joseph II, in Austria, the Grand-Duke 
of Tuscany, and the Grand-Duke of Baden. There was 
insensibly formed in France a nursery of statesmen 
imbued with their maxims : M. de Gournay, M. de 

* Ordre Nature I et Essentiel, etc. Vol, i, pp. 199, 280, 281, 



360 HISTORY OF POLITICAL ECONOMY. 

Trudaine, M. de Malesherbes, M. d'Argenson, and the 
illustrious Turgot who combined their virtues and their 
talents. All these worthy men adopted unreservedly the 
patriarchal doctrines of Mercier de la Riviere ; but they 
gradually made the maxims of toleration of the Econo- 
mist school penetrate the government, and, by brilliant 
attempts in some provinces, either as intendants or as 
ministers, they preluded the reforms achieved by the 
French revolution. The abuses of corporations, custom- 
houses, corv^es, and fiscal measures, were pointed out by 
them with indefatigable perseverance ; and in their ardor 
for scientific conquests, they raised, by the way, the most 
profound social questions. Their errors even were useful 
and their most vague presentiments seem always to con- 
tain something prophetic. " Moderate your enthusiasm," 
exclaimed Mercier de la Riviere, "blind admirers of the 
false products of manufacture ! Before crying ' Miracle ! ' 
open your eyes and see how poor, or at least uncomfort- 
able, these very workmen are who have the skill to 
change twenty sous into the value of a thousand crowns. 
Who profits by this enormous multiplication of values ? 
Why ! Those by whose hands it is brought about, do not 
know comfort ! Ah ! be distrustful of this contrast." * 
Mercier doubtless attributed the miseries of the manu- 
facturing class solely to the distressed condition of agri- 
culture and the insufficiency of the net product ; but al- 
though he was mistaken in the causes, he very well noted 
the effects ; and the contrast which he recommended 
them to regard with distrust, contained the problem 
which the present time has not yet succeeded in solving. 
Adam Smith has written nothing clearer and more 
vigorous than the fine demonstrations of the Eco7ioniists 
in favor of freedom of trade. These ideas of general 
fraternity among nations, so popular in our day, were 
developed by Mercier de La Riviere with an irresistible 
enthusiasm and a power of reason which could not be 

*Ordre Naturel et Essentiel, Vol. ii, p. 407. 



FUNDAMENTAL ERROR OF ECONOMISTS. 36 1 

surpassed. There is even cause to think that this re- 
markable writer would have powerfully aided govern- 
ments to find a better basis for the assessment of taxes, 
if he had not been swayed by the doctrine of the net 
product and of the classes reputed unproductive. The 
tax, he said, is a portion of the net revenue of the nation, 
applied to the necessities of its government. Now, that 
which is a portion of the net product alone, can be 
taken only from the net product ; the tax can then be 
demanded only of those who possess the total net pro- 
duct of which the tax is a part. Consequently, the Econo- 
mists considered as arbitrary and unjust any personal tax, 
and they included in a common reprobation all indirect 
taxes. What would they have said if they had seen, in 
our day, these taxes produce in England more than a 
milliard, and in France more than five hundred millions? 
This fundamental error, which later became the basis 
of the financial doctrines of the Constituent Assembly, 
notwithstanding the efforts of Roederer and some of his 
colleagues, was the result of a false idea of the principles 
of wealth. The theory of value, invented since, by 
Adam Smith, would have taught the Economists that 
labor as well as land is a source of wealth, and that they 
erred in not observing the similarity between the material 
multiplication resulting from a grain of wheat entrusted 
to the earth, and the multiplication of values produced 
by the processes of manufactures and commerce. That 
unfortunate doctrine of the net product, closed their 
eyes to an infinite number of truths which they would 
have deduced from the observation of facts, if they had 
followed the strict method of the writers who succeeded 
them. But, in their false route, they nevertheless made 
admirable discoveries, like those alchemists who found 
so many useful substances, while searching for the phi- 
losopher's stone. We are even indebted to them for the 
labors of the men who have surpassed them, and no one 
to-day doubts that Adam Smith himself, who resided 



362 HISTORY OF POLITICAL ECONOMY. 

some time in France and who lived on terms of intimacy 
with the Economists, derived from them his first acquaint- 
ance with the subject. He always speaks of them in his 
writings with respect, and he intended to dedicate his 
great work on the Wealth of Nations to Quesnay, if that 
economist had been alive at the time of its publication. 

The Economists have often been accused of a revolution- 
ary tendency, because of the intimacy which prevailed be- 
tween these savants and the Encyclopedic Philosophers." 
We must not, however, forget that Voltaire had made cruel 
sport of their doctrines on taxation, in his Hojnme aux 
Quarante Ecus, and that Montesquieu had responded to 
their manifestoes in favor of free trade by a chapter en- 
titled. To what Nations it is Disadvantageous to carry on 
Commerce. It is certain that the Economist school con- 
tributed no less than the Philosophic school to the reform 
of European social order. While the Philosophers earnestly 
attacked abuses of every kind, without regard to choice of 
weapons, the Economists contented themselves with show- 
ing, with magisterial calmness, the essential disadvantages 
of these abuses. They kept a dignified and stern reserve 
in the midst of the running fire of epigrams or philippics 
with which the Encyclopedia pursued the past, and they 
lived at the same time on good terms with the court 
without being courtiers, and with the Philosophers with- 
out being railers. Their impartial gravity caused them 
to be respected by both parties, and Louis XV, himself 
called Quesnay his thiriker {^penseur)r The latter resided 
at Versailles in the palace of the king, which consequently 
became the rendezvous of the boldest reformers. " While 
storms were gathering and scattering beneath the entresol 
of Quesnay," says Marmontel in his memoirs, " he was 
scribbling away at his axioms and his calculations in 
rural economy, as tranquil and as indifferent to these 
commotions of the court, as if he were a hundred leagues 

* He had given him for arms three flowers of the pansy i^pens^e — a 
thought), with this device : Propter excogitationetn mentis. 



QUESNAY'S CHARACTERISTICS. NEW SCIENCE. ^6 



0^:) 



away." He never took part in any intrigue ; and he died 
at the age of eighty years, leaving a name revered 
throughout all Europe, which did not, however, compre- 
hend the wide bearing of his doctrines. Quesnay wrote 
little, and in a manner nearly always sententious and ob- 
scure. He threw out his ideas to his followers like an 
oracle, without appearing to attach any importance to 
them, and as if to give something to think of. But his 
formulas were eagerly collected and developed by the 
numerous group that gathered about him. From their 
circle came forth the signal of all the social reforms car- 
ried out or attempted in Europe for the past eighty * 
years ; and we might say that, with the exception of a 
few maxims, the French revolution was only their theory 
carried into action. 

The Economises present themselves, in fact, with the 
advantage of a compact and serried column under the 
same colors. They have a common rallying cry, a com- 
mon doctrine, and that dogmatic language which always 
exercises its accustomed influence over the vulgar. Their 
principles were everywhere proclaimed in the same terms, 
with the same mathematical precision, and Quesnay does 
not disdain to have recourse to specious combinations of 
figures, to justify his aphorisms. Three pages suffice to 
sum up the new science, as they call it, and yet Mirabeau 
the elder dilutes it to two enormous quarto volumes. It 
is essential that it penetrate everywhere. It is, in their 
opinion, as indispensable to the king as to the most 
humble citizen. It is promulgated under the form of 
tables, instructions, dialogues, treatises, letters, and jour- 
nal articles. Les Eph^m&ides du citoyen, Le Journal 
d'Agricidture and Le Journal Econoniiqiie propagate it 
without fear of censure, so well known are the Economists 
as friends of order, even to the point of sacrificing to it 
liberty. 

The condition of the peasant, heretofore so humble and 
unjustly degraded, rises to the first rank among honorable 



364 HISTORY OF POLITICAL ECONOMY. 

occupations. People demand means of communication 
from all parts, and then begins that fever for roads and 
canals which is breaking out again in our day. Great 
roads are multiplied as if by enchantment. In many 
places, the corvee is abolished ; common pasturage is 
done away with ; free trade in grain is demanded. The 
rural districts have at length obtained a glance from the 
cities, and agriculture comes forth from the frightful con- 
dition in which it had languished for several centuries. 

The Economists were not, however, all perfectly in ac- 
cord in regard to the system of Quesnay. They agreed 
on doctrines ; they differed as to their application. M. 
de Gournay, the son of a merchant and himself a mer- 
chant, was the real author of the famous adage ; Laissez 
fairs et laisses passer.'^ He it was who commenced the 
war on monopolies and demonstrated the imperative 
necessity of abolishing duties on raw materials. Quesnay, 
the son of a cultivator, had turned his attention more 
particularly to agriculture, and he was thus led to his 
ingenious hypotheses on the influence of agricultural 
production, with all their train of deductions, both in 
what concerns taxation and in connection with labor. M. 
de Malesherbes, the abb6 Morellet, Trudaine, Doctor 
Price and Mr. Josiah Tucker belonged to the shade of 
Gournay ; La Trosne, Saint-Peravy, Mirabeau the elder, 
and Dupont de Nemours, preferred the absolute ideas 
of Quesnay. Mercier de La Riviere and the abbe Ban- 
deau, more politic and less abstract, inclined towards 
supremacy of the civil power and wished to invest it 
almost exclusively with the direction of the social move- 
ment. Turgot proceeded by himself, being the issue of 
them all and destined to realize their ideas by prompt 
and decisive applications. He was eclectic and practi- 
cal, like a philosopher and a statesman. But what 
especially distinguished that generous family of friends 
of the human race, was the admirable probity of each of 

*i.e. " Let us alone, and keep the ways free." 



CHARACTERISTICS OF THE ECONOMISTS. 365 

its members and their sincere disinterestedness in every- 
thing. They sought neither splendor nor renown. They 
attacked none of the established powers, and they did 
not aspire to become popular, although they were anima- 
ted by a profound sympathy for the people. They were 
true philanthropists, in the noblest acceptation of this 
word. Their books are forgotten ; but their doctrines 
have germinated like a fruitful seed, and the precepts 
which they taught have made the circuit of the world, 
freed the industrial arts, restored agriculture, and pre- 
pared the way for commercial liberty. After Quesnay 
came Turgot ; after Turgot, Adam Smith ; science hence- 
forth marches with giant steps. 



CHAPTER XXXIII. 

The ministry of Turgot. — Economic reforms he undertakes. — Opposition 
he encounters. — His influence on the course of political economy. 

The ministry of Turgot was only the doctrine of the 
Economists carried into action. It was the first time that 
the science had the good fortune to find a minister 
disposed to realize all its conceptions, and try thor- 
oughly all its experiments. Turgot devoted himself to 
the task -with the zeal of a neophyte and the conscien- 
tious persistency of a magistrate. The most illustrious 
of his predecessors, Colbert, had ventured to attempt 
much less, even with the support of a will like that of 
Louis XIV ; it will be an interesting spectacle to view 
Turgot battling all the economic prejudices of the past 
ages, which he wished to root out at a single stroke. 
The consequences of that heroic attempt merit the con- 
sideration alike of peoples and of governments, for 
nothing less than a revolution was needed to assure its 
success. 

Turgot was a pupil of the Economists and a supporter 
of their doctrines, principally in everything that con- 
cerned freedom of trade in grain, and the land-tax. His 
works contain a great number of articles in which he 
shows himself the defender of the fundamental maxims 
of the system of Quesnay. He was not so, however, 
unconditionally ; and his administrative experience had 
made him feel more than once, how much management 
was necessary in the execution of even the most indis- 

366 



TURCOT. REFORMS. OPPOSITION. 367 

pensable reforms. But the fierce opposition he encoun- 
tered chafed his sense of probity, and prevented him from 
always keeping a suitable moderation, in the midst of the 
conflict of opinions. He had been early impressed by 
the deplorable state of the people of the rural districts, 
weighed down as they were by tithes, corvees, and exac- 
tions of every kind. In the cities, the wretchedness of the 
working classes had no less pierced his soul, and the sys- 
tem of corporations, that system so contrary to respect 
for personal property, had strongly excited his disappro- 
bation. Accordingly, as soon as he had come into power, 
he began his work with the precipitancy of a man who 
fears he may not last long, and who wishes, at least, to 
do all the good possible by the way. Reform edicts 
succeed one another, stroke upon stroke, accompanied by 
lengthy statements of the reasons for them, too lengthy, 
perhaps, not to appear timid, and more like scientific 
dissertations than publications from the highest authority. 
Then, too, how much opposition he had to encounter, 
how many prejudices to overcome, and coalitions to 
break up ! Turgot struck at everything ; nobles, finan- 
ciers, bourgeois, priests, lawyers, monopolists ; he wished 
everything to bend under the yoke of his reforms, and he 
seemed to despair of nothing. ^^ I venture to assert,'' said 
he to the king, " that in ten years the nation will not be 
recognizable r * In conformity to the practice of the 
Economists, he first turned his attention towards the rural 
districts, and he considered it his duty to attack the ab- 
surd legislation which forbade the exportation of grain, 
convinced that the best way to prevent scarcity was a 
free circulation of the crops. It was, however, from this 
quarter that came the most vigorous opposition and the 
worst difficulties. Chance decreed that the emancipation 
of the commerce in grain should be coincident with a 
year of scarcity, and the people, accustomed to watch 
over their supplies as a sacred trust, were irritated, in 

* Memoire au roi, in the collection of Dupont cle Nemours, vol. vii. 



368 HISTORY OF POLITICAL ECONOMY. 

many parts, at exportations which seemed to threaten 
them with famine. These exportations were in some sort 
only internal, since they only took place between prov- 
inces, and they could not deprive France of the possession 
of her grain ; besides, Turgot had favored importations 
of grain from foreign countries : but what could these 
arguments effect against fear and calumny ! and what 
could be expected of the multitude, when writers like the 
abbe Galiani and M. Necker himself descended into the 
arena to maintain the most foolish prejudices ? Turgot, 
in desperation, decided to use force, and marched troops 
against the riotous bands who were covering the rural 
districts, stopping the arrivals and proceeding to the 
plunder of grain. 

Such was the result of the first attempt at reform by 
this honest man and minister, of whom Louis XVI said, 
" Turgot and I are the only ones who love the people." 
He desired to put bread within reach of everj^ mouth, 
and he was disgraced like a public enemy. People repre- 
sented him as the protector of monopolists and the ac- 
complice of the great land-holders. They quoted some 
unlucky passages * in the Economist writers, which had 
maintained the necessity of a high price for grain, in 
order to increase the net product of agriculture, and Tur- 
got was accused of starving the people to make an absurd 
Utopia succeed. He could triumph over the opposition 
of parliament only by means of lits de justice. At Rouen, 
the trade in grain was in the hands of one hundred and 
twelve merchants. They alone could buy and sell grain. 
A fraternity of ninety porters enjoyed the exclusive right 
of transporting the sacks under their orders ; another 
association had the exclusive privilege of grinding for the 
consumption of the inhabitants. All was monopoly, 

* Quesnay had said: "Let it not be supposed that a cheap provision 
market is advantageous to the humble class of people ; want and dearness is 
misery, abundance and dearness is opulence." {General Maxims of Econ- 
omical Government, xix, xx.) 

But how reconcile dearness and abundance 1 



TURCOT. CONSTRUCTION OF ROADS. 369 

abuse and tyranny. Turgot determined to apply here 
his hatchet ; but every blow he struck rebounded upon 
himself. In reading the long preambles of all the edicts 
he caused to be issued, we know not whether to be 
more astonished at the patience of the men who suffered 
the exactions there pointed out, or the folly of those who 
endeavored to prevent this great minister from putting 
an end to them. He encountered the same opposition, 
when, after having secured free trade in grain, he at- 
tempted to repress the abuses which hampered that in 
wines. Accustomed as we are, since the Constituent As- 
sembly, to the equality of citizens and of departments 
before the law, it is difficult for us to comprehend to-day 
the shouts of rage with which, especially in the south, 
the reform in local privileges, so numerous in the matter 
of wines, was received. What shall we say then, of the 
contest which ensued between Miromesnil, the keeper 
of the seals, and Turgot ? 

We can but observe in the collection of the works of 
the latter, in what an animated, and at the same time 
logical style, he shows the severity of a system which im- 
posed on the poorest and most unfortunate class, the 
burden of the construction and maintenance of the roads.* 
And how much had he not already had to contend with 
in order to obtain the roads themselves ! We over- 
look too much the fact, in France, that it is to the Econo- 
omist system, the agricultural system, that we owe the 
idea of the first great lines of communication with which 
the country has been endowed, f and to Turgot their con- 
struction. When there was question as to the appor- 
tionment of the expense between the different classes of 
citizens, Turgot, faithful to his motto, took up the de- 

* Vol. viii of the edition of Dupont de Nemours, pp. 178-262. 

\ " Let openings to markets, and the transportation of productions and of 
the results of manual labor, be facilitated dy the repair of the roads, arid 
by navigation on canals, rivers, and the sea ; for the more that is saved in 
the expenses of commerce, the more the revenue of tlie territory \f in- 
creased." {General Maxims of Economic Government, xvii.) 



370 HISTORY OF POLITICAL ECONOMY. 

fence of the poorer ; M. de Miromesnil was moved by 
the fate of the richer. Here is a sample of their dia- 
logue, written by the former under the form of observa- 
tions, by the second under the title of responses. We 
regret that we can only quote this fragment ; but this 
fragment belongs to the history of the science. 

The Keeper of the Seals. " The land proprietors, who ap- 
pear at the first glance to form the happiest and most opu- 
lent portion of the subjects of the king, are also those who 
bear the heaviest burdens, and who, on account of the 
necessity which they are under, of employing the men 
who have only their arms on which to rely for support, 
furnish the latter the means of subsistence." 

Turgot. " Because the proprietor feels the blow of the 
ruin of his farmer, it does not follow that this farmer 
may not be still more unfortunate than his master. 
When a post-horse falls, overcome with weakness, the 
rider falls too, but the horse is still more to be pitied. 
The proprietors, by their disbursements, give support to 
the men who have only their arms ; but the proprietors 
enjoy for their money all the comforts of life. The daily 
laborer works and earns by the sweat of his brow the 
scantiest subsistence. But when he is obliged to work 
for nothing, there is taken from him even the resource 
of subsisting from his labor by the expenditure of the 
rich." 

Keeper of the Seals. " The land-owners are not the ones 
who profit by the public roads being well maintained. 
Travellers, wagoners, and peasants even, who go on foot, 
likewise profit by them : travellers get over more ground 
in less time and at less expense, and wagoners tire their 
horses and wear out their wagons less ; the simple peas- 
ant who goes on foot, walks more easily on a fine road 
than in a bad path. Hence the advantage of the high- 
ways extends proportionally to all the subjects of the 
king." 

Turgot. " Travellers gain a more speedy passage from 



TURGOT'S SYMPATHY WITH LABORERS. 37I 

the fine condition of the roads. Excellence of the roads 
attracts travellers, and multiplies their number ; these 
travellers expend money, and consume the provisions of 
the country, all of which turns always to the advantage 
of the proprietors. As to the wagoners, their expenses 
in cartage are less in proportion as they are less time on 
the road and save their horses and carts more. From 
this diminution in the outlay for cartage, results a fa- 
cility in transporting provisions further and selling them 
better. So all the advantage is for the landed proprietor 
who sells his produce better. In regard to the peasants 
who go on foot, the Keeper of the Seals will permit me to 
beheve that the pleasure of walking on a road of well- 
broken stone does not compensate them for the trouble 
they have had in constructing it without pay." 

In this rapid interchange of arguments, both Turgot 
and the Keeper of the Seals imperfectly apprehend the real 
effects of improvements in the highways. They both 
talk like men who are strangers to a sound theory of 
wealth, but what a difference in their language in what 
concerns the interests of the laboring classes! What 
lively sympathy in Turgot ! what cold indifference in the 
other ! But see by this what the lessons of the Econo- 
mists had already effected, and to what ground questions 
of political economy had been brought! Turgot kept 
them there during the whole of 'his ministry, and he in- 
variably prosecuted, one by one, and so to speak, accord- 
ing to a programme determined in advance, the solution 
of every one of those which the school of Quesnay had 
raised. After the edict suppressing the corvees, came 
the famous edict of February, 1776, the chief work of 
Turgot, the charter of freedom for the working classes. 
The historian to-day has only to pay his respects to the 
memory of that brave act ; which, however, was almost 
immediately followed by a return to monopoly and privi- 
leges,* though triumphant a few years later by the aid oi 
* The edict of 1776 was revoked three naonths after it was issued. 



372 HISTORY OF POLITICAL ECONOMY. 

a revolution. The abolition of corporations was a great 
and fine measure, but how much was its merit enhanced 
by the terms of this memorable preamble, the noblest 
perhaps which administration has ever borrowed from 
science ! " God, by giving man wants," said the preamble, 
" by rendering the resource of labor necessary to him, 
has made of the right to work the property of every 
man ; and that property is the first, the most sacred, the 
most imprescriptible of all. We consequently desire to 
abrogate those arbitrary institutions, which do not permit 
the poor man to live by his labor, which extinguish emu- 
lation and industry and render useless the talents of 
those whom circumstances exclude from admission into 
a corporation ; which weigh down manufactures with an 
enormous tax, burdensome to the subjects and without 
any advantage to the state ; which, in short, by the facili- 
ties they afford members of corporations to league to- 
gether and to force the poorest members to submit to 
the law of the richest, become an instrument of monopoly, 
and favor manoeuvres the effect of which is to raise the 
provisions most necessary for the subsistence of a people, 
above their natural rate." All the rest is written in this 
stern and uncompromising style, which granted no favor 
to any abuse and which stigmatized them all before men 
who were astonished at the long oppression of their 
fathers and the absurdrty of so many useless vej^ations. 
What we have already said * upon this subject, does not 
permit us to enter further into this question, henceforth 
solved, the solution of which has obtained the highest 
sanction of experience and time. 

After having freed the laborer from the corvee and the 
mechanic from the power of the masters, Turgot de- 
termined to save the merchant from usury ; and he entered 
upon that reform with the lofty and adventurous views 
which distinguished his character. He had published, in 
1769, an extremely remarkable memoir on Money Loans, 

* See chap, xix of this work, devoted to the institutions of Saint Louis. 



TURGOT'S VIEW OF TAXATION. 373 

in which he pointed out the essential faults of restrictive 
legislation on rate of interest, a legislation so successfully 
confuted since by Jeremy Bentham : he wished to do 
more ; and, to finish the work that he had so well begun, 
he promoted the establishment of a bank of discount, 
which would neutralize, by its low rate of interest, the 
excessive demands of loaners of capital. It even occurred 
to him to give publicity to mortgages, so that it should 
be impossible, he said, for owners of land not to pay 
their debts ; and the security of the credit would lower 
the interest of money. Whether he was right or wrong 
in his hope, we cannot too much praise his solicitude in 
thinking of all reforms which might favor labor and pro- 
duction in our country. 

There remained to Turgot one great experiment to 
try, that of reform in the taxes ; and here the erroneous 
opinions of the Economists came near causing him disas- 
trous miscalculations. The positive doctrine of the net 
product might, in fact, be very innocent, so long as it did 
not depart from the narrow circle of abstractions, but 
there was much danger in upturning, from bottom to 
top, the whole fiscal system of France for the triumph 
of a mere hypothesis. Turgot, prepossessed with the 
idea of a general removal of the burdens of the poor 
classes and the need of emancipating all branches of in- 
dustry, was convinced that by reducing all taxes to one 
single land-tax he would reach simply the net product, 
that is to say, the annual creations of natural labor on 
the land. His plan was to devote one part of this pro- 
duct to taxes, and to leave the other in the hands of the 
proprietors, born-distributors of the wages, according to 
Quesnay. But the proprietors were justly alarmed by 
an experiment which attacked their revenue at its source 
and degraded their property, which thus became the ob- 
jective point of all taxes. The project of Turgot was, be- 
sides, unjust in this respect, that the real wealth created 
by laborers other than agriculturers, was exempt from 



374 HISTORY OF POLITICAL ECONOMY. 

taxation as if it were not wealth, although it really was 
so. Thus the proprietors of lands were made to bear 
the fiscal consequences of an error of doctrine, and the 
government was ruining them in the best faith possible, 
while proclaiming them preeminently tJie producers. It 
was a great misfortune to science that Turgot was so pre- 
cipitate in applying a theory so hazardous and so radi- 
cally false, as if its correctness had been demonstrated 
with mathematical certainty. Moreover, in this case, the 
past commanded great consideration from a statesman. 
Whatever the intensity of his convictions, he should not 
have proceeded to such reforms with the eagerness of a 
partisan, but with the prudence of a legislator. His 
error, which was shared later by the Constituent Assem- 
bly, precipitated France into an abyss of evils, by de- 
priving the government, for several years, of the immense 
revenues it would have found in indirect taxes, the 
principle of which rests on the production of immovable 
{imniobiliere) wealth, as the land-tax does on the produc- 
tion of agricultural wealth. 

Turgot wished no more loans, and his bank of 
discount was not a measure preparatory to a reestablish- 
ment of great public credit. The economist school de- 
nied the influence of public credit on public prosperity. 
They did not allow that the annual revenue of the state 
should be anticipated, even for useful purposes ; and be- 
cause they had dreamed of the age of gold, they seemed 
not to suppose that there could ever be hard times to be 
encountered. It was this confidence in his philosophy 
which animated Turgot when he had corporations abol- 
ished. He did not even suspect that this great act of 
emancipation, which cannot be too much praised, would 
be followed by formidable complications, whose solution 
would some day demand a genius more bold, if not more 
loyal than his. He was so happy to restore freedom of 
labor to that multitude of comrades bound down to the 
glebe of the workshop ! He presaged such brilliant des- 



AIMS OF TURCOT, OPPOSITION. 375 

tinies for the French nation, reinstated in possession of 
so many living forces ! Who could have told him that 
after a half century, competition among laborers would 
bring about a reduction of wages, pauperism, and all the 
miseries which dim the lustre of our civilization ? He 
marched with as firm a step, in the pursuit of Utopias, as 
in the reform of abuses, and the mind is overpowered at 
all which he undertook with his simple forces as minister, 
at a time when ministers did not have many of them at 
command. He had projected the suppression of monas- 
teries, the just distribution of taxes, one single civil code 
for the whole kingdom, unity of weights and measures, 
a new system for public instruction, the establishment of 
a record of the survey of lands, not to mention a multi- 
tude of special measures which attest the solicitude of 
an administrator as well as the intelligence of a savant. 
" He acted," says S6nac de Meilhan, " like a surgeon who 
operates on dead bodies, and he did not dream that he 
was operating on sensible beings : he only saw things, 
and did not concern himself sufficiently with persons. 
This apparent harshness had its origin in the purity of 
his soul, which pictured men to him as animated with 
an equal desire for the public good, or as knaves who de- 
served no consideration." 

Accordingly, from every direction, the projects of Tur- 
got encountered obstinate resistance. Much of it came 
from the court ; still more, from the city. Most of it 
was unjust and shameful, because dictated by private 
interest ; * some, on the contrary, seems to have had 
good foundation, because the reforming minister had not 

* Among the useful creations of Turgot which made great talk, we must 
mention the establishment of the first public stage-coaches, the competition 
of which injured the old monopolizers of transportation. It was an immense 
advantage for all classes of citizens : the minister, however, was satirized in 
ballads. One may judge of them by the following epigram published on that 
occasion : — 

" Ministre ivre d' orgueil, tranchant du souverain, 
Toi qui, sans t'emouvoir, fais tant de miserables, 
Puisse ta poste absurde aller un si grand train, 
Qu'elle te mene a tous les diables ! " 



376 HISTORY OF POLITICAL ECONOMY. 

sufficiently taken into account the exigencies of the past. 
The first germ of opposition came from the parliaments, 
which too many people are accustomed to consider as the 
defenders of all progressive ideas, but which made the 
fiercest war on Turgot which he had to sustain. This 
truly virtuous minister cannot be too highly honored for 
the courage with which he persevered in the long struggle 
with which his whole administrative career was agitated. 
One of his friends reproached him with being in too much 
of a hurry about his reforms : " How can you reproach 
me for that ? " he replied : " You know that in my family 
we die of gout at fifty years." The whole explanation of 
his conduct is in these words. Turgot committed no 
other wrong than that of wishing too soon and at any 
cost, the success of that which appeared to him advan- 
tageous to his country. His love for improvements 
extended to everything, poetry, education, astronomy: 
" There you are," said the Abbe Morellet to him one 
day, " doing in physics as in administration, fighting 
against Nature, which is stronger than you and is not 
willing that man should have the precise measure of any- 
thing." Even to his last breath, in spite of the miscal- 
culations and the hindrances of his administration, he 
held to the doctrines of the Economists, with all the 
strength of religious conviction. He carried philan- 
thropy so far as to wish his servants to be as well lodged 
as he, and he went to considerable expense on this ac- 
count in his mansion. 

Turgot left a great number of writings which were care- 
fully collated by Dupont de Nemours.^" Administrators 
in all times and all countries will obtain from them useful 

* This collection is composed of nine octavo volumes, which appeared from 
1808 to 1811. Dupont had it preceded by a life of Turgot, which is not 
worth the notice published by Condorcet. {Author s Note.) 

The works of Turgot have been reedited by M. Eugfene Daire, with the 
notes of Dupont de Nemours and unedited letters, questions on commerce, 
and observations and new notes by Messrs. Daire and Dussard. This im- 
portant publication (1844, 2 vol., gr. in 8vo.) makes a part of the Collection 
of the Principal Economists, by Guillaumin. — Fr. Ed, 



. turgot's writings, rate of interest. 377 

information, for never did this minister touch upon a 
single question before having investigated it thoroughly ; 
and almost all the preambles of his edicts are complete 
treatises on their subject matter. But the most interest- 
ing of his works is his Treatise on the Formation and Dis- 
tribiition of Wealth ; and although it bears the impress 
of the ideas of the Economists, we can see in it the dawn- 
ing symptoms of a dissent which leads to the theory of 
Adam Smith. Division of labor, the true functions of 
money, and the operations of commerce are there set 
forth with remarkable clearness and precision. The most 
learned economists of the nineteenth century have not 
demonstrated better the influence of the. rate of interest 
on all enterprises. ''It maybe regarded," says Turgot, 
" as a sort of level, below which all labor, all culture, all 
manufactures, all commerce, cease. It is like a sea spread 
over a vast country: the summits of the mountains rise 
above the waters and form fertile and cultivated isles. 
If that sea should flow back, as it descends, first the lands 
on mountain slopes and then the plains and the valleys 
appear and become covered with products of every kind. 
If the water rises or falls one foot, it is enough to inun- 
date or to restore to cultivation immense areas. It is 
abundance of capital which animates all enterprises, and 
low interest for money is at the same time the effect and 
the indication of abundance of capital." 

The treatise on the formation and distribution of 
wealth preceded by nine years the publication of Adam 
Smith's work, and was not without influence on the 
doctrines of the celebrated Scotch economist. Turgot 
thought as he did on interest-loans, free trade, free man- 
ufacture, the influence of lines of communication, the 
elements of price, and the formation of capital. It is a 
real glory to have thus preceded, in this work, the great- 
est writer who has honored science, and to be considered, 
m so many respects, as his precursor; but the most in- 
contestable honor which belongs to Turgot will always 



378 HISTORY OF POLITICAL ECONOMY. 

be, to have opened the field of experiment to the first 
theories of political science which were boldly formu- 
lated ; to have submitted them to the test of practice, 
and to have invited, not alone savants, but also the 
people, to judge them. All the literature of the last half 
of the eighteenth century bears the impress of this in-' 
fluence. Montesquieu, D'Alembert, Marmontel, Condor- 
cet, Raynal, Condillac, J. J. Rousseau and Voltaire even, 
speak of political economy in their writings , the daily 
papers, the collections of writings of every kind, hence- 
forth devote to it a place. People from this time begin 
to comprehend that there is a physiology of the social 
body as there is of the human body, and that there are 
laws according to which nations prosper or waste away, 
like individuals. Economic science is henceforth ad- 
mitted to the councils of governments: it will go no 
more out from such councils, as soon as Adam Smith 
shall have impressed it with the seal of his genius. 



CHAPTER XXXIV. 

The labors of Adam Smith and their influence on the progress of political 
economy. — Difference between his doctrines and those of the Economists . 
Statement of the creations due to him. — His fine definitions of value, labor, 
capital and money. — Great results of his discoveries. 

The principal merit of the Economists consisted in rais- 
ing the profoundest questions of political economy, and 
that of Turgot, in attempting their practical solution, by 
means of the administrative power. We have seen with 
what talent and what meritorious perseverance these 
philosophers devoted themselves to the cultivation of a 
science which seemed to them to include tJie destinies 
of the human race : but not for them was reserved 
the honor of laying its foundations in a solid and 
enduring manner. They had only perceived, under a 
false light, its principal aspects ; but their errors had 
served, at least, to awaken a profound examination of 
the questions which it had been impossible for them to 
resolve. Instead of proceeding by the experimental 
method and by the observation of facts, they had pro- 
claimed as infallible dogmas certain formulas, which 
seved to explain to them all the phenomena of social 
physiology. When an argument capable of modifying 
their belief in these dogmas came in their way, they 
strove to connect it with their system by ingenious or 
bold hypotheses; and they fell, without perceiving it, 
into the abyss of Utopias. We have seen that their 
aphorism of the net product had prevented them from re^ 
cognizing the immense part manufactures and commerce 

379 



380 HISTORY OF POLITICAL ECONOMY. 

have in the production of wealth, and that their theory of 
property had led them to the suppression of all indirect 
taxes. They had touched upon all questions and they 
had resolved none ; but they had called the attention of 
all Europe to the most difficult, and Europe responded 
to their appeal. 

A Scotch philosopher, of that school from which so 
many thinkers have sprung, was teaching at Glasgow, at 
the same time as the Economists at Paris, the princi- 
ples of the wealth of nations. It was about the year* 
1752, nearly at the time when Quesnay was publishing 
his Tableau Economique, and laying the foundations 
of his doctrine. But the Glasgow professor had early 
accustomed himself to study facts, compare them and 
deduce conclusions from them : consequently he was led 
to results very different from those obtained by the Econ- 
omists. The two schools had in common only the same 
love of the well-being of society, the same directness and 
the same scrupulous fidelity to the interests of truth. 
As to everything that concerns science, the starting point 
being altogether different, the results could not be the 
same, and soon the widest difference of opinion became 
manifest. The Economists attributed productive power 
only to the earth ; Adam Smith found that power in 
labor, and from that luminous idea he brought forth the 
most unforeseen and the most decisive conclusions. Here 
begins the history of the revolution produced by the 
publication of his Inquiry into the Nature and Causes of 
the Wealth of Nations, which appeared for the first time 
in 1776, that is to say, twenty-four years after the open- 
ing of his career. A day will soon come when that cele- 
brated publication will bring forth all its fruit, and its 
memorable date will be engraven on alt minds. Let us 
then attempt to imitate the logical and severe method of 
the great writer who was its author, and in a brief sketch 
ascertain the importance of this fine work to the future 
of civilization. 



ADAM SMITH ON WEALTH AND CAPITAL. 38 1 

In investigating the causes of the wealth of nations, 
Adam Smith recognized that this wealth originated not 
only from the fertility of their soil, but also from the 
labor of their inhabitants. It was labor which alone 
could render the earth largely and regularly productive, 
and it was moreover to labor that human society owed 
the products of its manufactures, and the profits of its 
commerce. Adam Smith summed up the result of his 
thought by saying that the annual labor of a nation was- 
the primitive source from which it derived its wealth, that 
is to say, the products necessary for its consumption, or 
those by means of which it produced for itself the pro- 
ducts created by other nations. Wealth consisted in the 
.exchangeable value of things, and one was the more rich 
in proportion as he possessed or produced more things 
having that value. Now, how did people give things an 
exchange value? By developing by labor a utility which 
they would not have had without it. Wealth could then 
be created, augmented, maintained, accumulated, de- 
stroyed. This simple definition overthrew at one stroke 
the doctrine of the Economists, and restored to their 
position all the laborious and honorable occupations 
which Quesnay considered as tributary and subordinate 
to landed property. No one was thrust back from the 
banquet of life ; labor had access everywhere and ceased 
to be unproductive : feudal servitude, maintained by Ques- 
nay under the name of reprisals of the land proprietor, 
had received its death blow. 

Labor being once recognized as the source of all wealth, 
economy and saving became the only means of accumu- 
lating it, that is to say, of creating capital. And here 
Adam Smith, with his rare intelligence, profited by the 
labors of his predecessors. He did not limit capital, as 
did the supporters of the mercantile system, to gold and 
silver ; but he included in it wealth of every kind amassed 
by the labor of man, especially the wealth employed to 
create new wealth by the aid of a new labor. At the 



382 HISTORY OF POLITICAL ECONOMY. 

same time, he gave the finest analysis of labor which ever 
came from the pen of any writer. This analysis serves 
in a certain way as a frontispiece to his immortal work, 
and the author has displayed in it a clearness of deduc- 
tions and a nobility of language truly worthy of admira- 
tion. Here are pointed out the marvellous effects of 
divisiojt of labor, often partially seen before Adam Smithy 
but nowhere demonstrated with that irresistible evidence 
and simple familiarity which leave no refuge for doubt 
and hesitation. Others would have taken their examples 
from the great works of industrial art : Adam Smith takes 
a pin, describes the various operations in its manufacture, 
and makes us see how ten workmen can make 48,000 pins 
a day, instead of four or five hundred, which is a hundred 
times less than they would do without that division. 
After this modest and conclusive example, he passes in 
review the advantages of the principle of division -of 
labor, and describes them in so animated and forcible a 
manner that no one, from that time, has dreamed of con- 
testing them. " Every workman has a great quantity of 
his own work to dispose of beyond what he himself has 
occasion for ; and every other workman being exactly in 
the same situation, he is enabled to exchange a great 
quantity of his own goods for a great quantity, or, what 
comes to the same thing, for the price of a great quantity 
of theirs. He supplies them abundantly with what they 
have occasion for, and they accommodate him as amply 
with what he has occasion for, and a general plenty 
diffuses itself through all the different ranks of the 
society." * 

Having analyzed division of labor, Adam Smith had to 
explain by what agencies the products of labor were ex- 
changed by means of money. What would regulate what 
is called the price of things f What are the elements of 
this price? What are the functions of money? These 
grave questions he resolved in an incomparably superior 

* Wealth of Nations, Book i, chap. i. 



SERVICES OF ADAM SMITH. 383 

and lucid manner. He, in fact, was the first to success- 
fully establish the influence of demand and supply on the 
rise and fall of prices, at the same time that he explained 
the functions of money in the circulation of products. 
The applications he made of his theory to bank-bills and 
paper money are of the highest importance in practice, 
and may be considered as one of the most useful con- 
quests of science. It is henceforth impossible to write 
on monetary science without adopting the bases which 
he imperishably laid down for it. In his course, Adam 
Smith unveiled the mysteries of the constitution of 
banks, and deduced from the consequences of their 
establishment, the principles on which they must rest 
in order not to bring disaster. Every man desirous 
of examining thoroughly the science of credit ought 
to commence his studies by that of the analyses which 
the illustrious Scotch economist has given of banks of 
circulation and banks of deposit. These are complete 
treatises which will never be surpassed, because they 
contain not one gap, not one superfluity. But the 
principal merit of Adam Smith lies in the perfect clear- 
ness of his definitions. They are generally based on a 
rigorous observation of facts. Once stated, he deduces 
conclusions from them by a method peculiar to himself 
which would alone suffice to assure him a high rank 
among the finest geniuses of modern times. The reader 
will be able to judge of it from a rapid exposition of his 
doctrines. 

As we have seen, according to this author, the essential 
quality which constitutes wealth, is exchangeable value, 
Exchangeable value differs from value in use, or utility, 
in this, that with the former, people can procure for them- 
selves many things; while the second, though useful, 
cannot be the subject of an exchange. There is nothing- 
more useful than water; but it can buy scarcely any- 
thing. A diamond, on the contrary, though of little 
utility, may serve to purchase a large number of commod- 



384 HISTORY OF POLITICAL ECONOMY. 

ities. The relation which exists between two exchangea- 
ble values, expressed in a value agreed upon, which is the 
money, is called price. The nominal price of things dif- 
fers from the real price, which represents the quantity of 
labor they have cost. The price of exchangeable things 
depends upon the accidental circumstances which make 
the present or current price deviate from the natural 
price. Price is ordinarily composed of three distinct 
elements ; the wages of labor, the profits of stock 
and the rent of the land which supplies the first ma- 
terial for labor. After having established in a perfectly 
methodical manner these introductory principles so sim- 
ple and so ingenious, Adam Smith determines the laws 
according to which the rate of wages is naturally estab- 
lished, and the accidental circumstances which make 
them vary temporarily from this natural rate. He then 
examines the laws in virtue of which the rate of profits 
is determined, and the exceptions to these laws; then 
he defines the rent of land which we call farm rent 
and which the Economists called net product. 

Wealth once created, Adam Smith divides it into two 
parts : that which is to be consumed immediately or in a 
short time, and that which is employed as capital to fur- 
nish a revenue. The capital is fixed when it is trans- 
formed into a workshop with all its instruments of pro- 
duction ; it is circulating ox movable when it is used to pay 
the wages of the workmen and renew purchases of raw 
materials. Improvements made on land form part of 
the fixed capital ; money and provisions belong to the 
circulating capital. The first is sometimes changed 
into the second, and the second sometimes in its turn 
takes a course which confounds it with the first. Money 
appears as the instrument of this double transforma- 
tion ; but notes, promises to pay, often take its place 
and even with advantage. This advantage depends upon 
the conditions on which one has borrowed and conse- 
quently on the rate of interest. Adam Smith adopts in 



DIVISION OF LABOR. MACHINES. 385 

this regard the Hberal theories of Turgot, and he de- 
monstrates by irresistible arguments their incontestible 
equity. 

Labor is now fully equipped : it is in possession of cap- 
ital : we shall next see it at work. Nothing is more sim- 
ple and admirable than the way in which Adam Smith 
explains its marvels ; we have cited his example drawn 
from the manufacture of pins. But what noble subjects 
for reflection are his numerous reviews of the army of 
laborers ! How naturally he has rendered an account of 
the progress of nations, by the progress in division of 
labor! How happily he has introduced, as a conse- 
quence of that division, the necessity of the exchanges ! 
How successfully he explains the increase of wealth, the 
perfecting of products and how their prices become daily 
more accessible ! It was he who revealed the secret of 
machines, those powerful modifications of the arm of 
man, those benefactors of the human race, which a dis- 
tinguished philanthropist* has unfortunately made the 
mistake of not appreciating. No one has more ably de- 
scribed their varied, infinite and lasting services, and 
without concealing their temporary disadvantages. At 
the same time, Adam Smith clearly laid down the limita- 
tions in their employment, and demonstrated that the 
extent of the market must be the habitual regulator of 
division of labor. On account of having neglected these 
wise doctrines, more than one manufacturing nation has 
seen formidable crises, resulting from obstructed circula- 
tion and restrictive measures. Thus Adam Smith ar- 
rived at free trade by a road quite different from that the 
school of Quesnay had followed ; but he was led to it by 
a much more just appreciation of the phenomena of pro- 
duction. 

His doctrine on taxation differed also essentially from 
that of the Economists. After having proved that all 
production came from labor, aided by capital, it was not 

* Sismondi. 



386 HISTORY OF POLITICAL ECONOMY. 

difficult for him to demonstrate that every citizen being 
qualified to create values, and consequently to make 
profits, owed to the state his contributive part of defence 
and of taxes. Every one obtained freedom in his work 
in return for his cooperation in the public burdens ; and 
there were no longer any sterile occupations, since every- 
body was capable of giving things an exchange value, by 
means of labor. What an encouragement to men ill- 
favored by fortune and to those who did not expect the 
boon of an inheritance ! They learned thenceforth at 
what price one acquires his independence ; economy was 
no longer an ascetic virtue, but the companion of labor 
and the source of capital. Instead of limits imposed on 
the products of agriculture, by the nature of the soil and 
the rotation of the seasons, one had before him the un^ 
limited horizon of exchange values, that is to say, unlim- 
ited wealth. Adam Smith did not, doubtless, foresee all 
these results, and many writers before him had advanced 
principles as true ; but he was the first one to show why 
they were true. He did more: he indicated the true 
method of pointing out errors. His work is composed 
of a succession of demonstrations which have raised 
several propositions to the rank of incontestible princi- 
ples, and which have forever annihilated a multitude of 
errors until then considered as principles. It was he who 
completely crushed the prohibitory system and the doc- 
trine of the net product, with his train of reflections on 
taxation and on imaginary classifications. Finally, and 
it was perhaps one of the greatest services he rendered 
to science, this immortal economist showed how private 
interest, when freed from restrictions, necessarily led the 
possessors of capital to prefer, all things being equal, the 
employment of it most favorable to national industry, 
because it was also the most profitable for them. 

It is true that Adam Smith sometimes wandered off 
into many digressions which prevent one from easily 
following the thread of his ideas. As soon as he en- 



OBSTACLES ENCOUNTERED. 387 

counters an old abuse, a hurtful prejudice, or an erro- 
neous system, he does not stop until he has done 
justice to it ; and these side skirmishes often divert him 
from the plan of his operations. But never does he 
take final leave of a subject without having exhausted 
it ; and he habitually presents the same idea under all 
its forms, until the reader has become familiarized with 
it. He had so much opposition to overcome and so 
many false doctrines to combat ! The Economists them- 
selves, whom he esteemed and who certainly contributed 
to the direction of his ideas, were not those who ren- 
dered his task the least difficult. He had to struggle 
against the innumerable works they had just published 
and which had been scattered throughout Europe, and 
more or less comprehended, with the authority of names 
most revered, like those of Gournay, Turgot, and Tru- 
daine. He was obliged to destroy most of the theories 
which they had just established at the cost of so many 
efforts, and to combat them under unfavorable auspices. 
This was the first memorable lack of harmony that ap- 
peared among the founders of political economy; and 
it has not a little contributed to give rise to the gen- 
eral indecision of the public on economic matters. 
Which was one to believe, Quesnay or Smith, maintain- 
ing with equal assurance contrary doctrines, and both 
simultaneously invoking the authority of facts! But 
we must not forget that there is not a science which 
did not begin by quarrels between its illustrious chiefs, 
and that these severe trials contributed, almost as much 
as their discoveries, to the progress of which we are to- 
day so proud. 

Adam Smith did not, however, have the honor of 
creating political economy at a single stroke ; and our re- 
spect for his memory must not prevent our rendering jus- 
tice to his predecessors and his successors. The demon- 
stration of the whole theory of values, of the effects of 
division of labor, and of the true functions of money, was 



388 HISTORY OF POLITICAL ECONOMY. 

of itself such a great historic fact ! Such analyses would 
suffice for the immortality of an author ; and we may 
boldly criticise what was incomplete in his writings, after 
having described wherein- they merited glory and consid- 
eration. The Economists were too much prepossessed 
with the importance of land ; Adam Smith accorded to 
labor a too exclusive preponderance in the creation of 
products. He did not sufficiently note the effect of land 
and capital, and notwithstanding his magnificent exposi- 
tions of the cooperation of machines, he does not present 
the theory about them best founded on the reality of 
things. In reserving exclusively the quality of riches for 
values embodied in material substances, he erased from 
the book of production that unlimited mass of immaterial 
values, offspring of the moral capital of civilized nations, 
and which form a part of their support and their glory. 
He struck out, at one stroke of the pen, lawyers, physi- 
cians, engineers, artists, public functionaries, producers 
all of real services exchangeable for material products 
since they -live by them and live well, when they have 
sufficient merit to secure generous payment. He had 
not perceived that the talent of these men was an accu- 
mulated capital, quite capable of giving interest in gold 
and silver, and very useful to society, which profits in its 
turn by their services.* 

The influence of trade and its effect on general produc- 
tion do not seem, either, to have been sufficiently appre- 
ciated by Adam Smith ; and some of his finest demon- 
strations are set forth by way of digression, in a place 
where they do not belong. Such are the principles relat- 
ing to the real and the nominal price of things, which are 
found in a dissertation on the value of the precious 
metals for the four last centuries ; and the information 
on moneys, which the author has misplaced by putting it 
into the chapter on commercial treaties. It is the dis- 

* Blanqui is in error here. Adam Smith expressly recognizes in Wealth 
of Nations, Book ii, chap, i, the talents of individuals as fixed capital. 
Smith's definition of wealth, was, however, loo narrow. — Trans. 



RESULTS OF COMPETITION. 389 

order which prevails around a productive mine, where 
fragments of the purest metal sometimes lie in confusion 
near the coarsest mineral. Besides, the Inquiry into the 
Nature and Causes of the Wealth of Nations is not com- 
prehended by every body, nor should we advise one to 
commence the study of the science with this book. It 
should be re-read several times for one to divine its fine 
construction and rightly estimate the results it has pro- 
duced. Then may one venture to contest a few of the 
propositions which Adam Smith has expressed in the 
most dogmatic form, such as that according to which 
private interest, free from restraints, seemed to him 
always sufficient to determine the employment of capi- 
tal most favorable to the community, since it determined 
that profitable to the managers of business. This doc- 
trine, which prevailed in England, and gave an extra- 
ordinary impulse to the arts and manufactures, is never- 
theless beginning to produce bitter fruits : it has created 
immense wealth, side by side with frightful poverty ; it 
has enriched the nation, while often treating a part of 
its citizens very cruelly. Is this the social end of the in- 
crease of wealth, or rather is it not an unhappy deviation 
from the social way? Can this excess of profits, deduc- 
ted, according to Sismondi, from the share of the poor, 
and according to us, from labor, by capital, be truly 
called riches ? 

Thus, universal competition originated from unlimited 
freedom of labor ; and from this competition, a torrent 
of wealth has been poured out upon the world, which 
indeed fertilizes many provinces, but which has left in 
more than one country fatal traces of its passage, like a 
brilliant and mysterious car, whose passengers cannot 
even see and pity the passers-by whom it crushes. The 
question has come to the point that the people are de- 
manding whether they should congratulate themselves or 
be disquieted at an advance in wealth which entails so 
many miseries and which multiplies hospitals and prisons 
as well as palaces. This is the great problem of the nine- 



390 HISTORY OF POLITICAL ECONOMY. 

teenth century, the one which Adam Smith had not 
foreseen and could not foresee, at a time when the steam- 
engine and the spinning-machine, those two giants of 
EngHsh industry, were only just born, like his book! 
We are to-day obliged to seek a regulator and to put a 
curb on those gigantic instruments of production, which 
feed and which starve men, which clothe and which de- 
spoil them, which relieve and which crush them. The 
question is no longer, as in the time of Smith, exclusively 
that of accelerating production : the latter must hence- 
forth be governed and restricted within wise limits. The 
question is no longer of absolute wealth, but of relative 
wealth ; humanity demands that masses of men who will 
not profit thereby, be no longer sacrificed to the progress 
of public opulence. Thus decree the eternal laws of 
justice and morality, too long disregarded in the social 
distribution of the profits and the labors ; and we will 
no longer consent to give the name of wealth, save to 
the sum of the national product equitably distributed 
between all the producers. Such is the French school of 
political economy to which we profess to belong, and its 
ideas will make the circuit of the world. 

Such as it appeared, nevertheless, the doctrine of Adam 
Smith wrought a complete revolution in the course of 
political economy. His opinions on the colonies acquired 
great weight from the events which were taking place in 
America, and his analysis of banks prepared the awaken- 
ing of Europe in the matter of public credit. Manufact- 
ures owed to him the removal of almost all their restric- 
tions, and commerce a beginning of the reduction of all 
tariffs. The questions of agriculture and population re- 
mained, which this great economist had only lightly touch- 
ed upon and whose solution concerns our children ; but the 
most dangerous prejudices had disappeared before his pow- 
erful argumentation, and their sway is forever ended. Bal- 
ance of trade, restrictive system, agricultural system, have 
all been precipitated into the gulf of vagaries; Adam 



PRIVATE WANT. PUBLIC WEALTH. 39 1 

Smith has demonetized them all by his severe logic and 
by his impartial observation of facts. One single un- 
certainty survived his doctrines ; what connection is there 
between population and means of subsistence ? Why 
does private want increase in our society, at the same 
time with public wealth ? Why does not the sun of in- 
dustry shine for everybody ? Two English writers are 
going to give you, each in his manner, an explanation of 
this social anomaly : the reader will divine that we mean 
Godwin and Malthus. It is time to hear them ; for, after 
Adam Smith, they became chiefs of a school by the same 
right ; each of them had a grand thought, a clear and 
striking thought, which commands attention and for the 
moment inspires terror. 



CHAPTER XXXV. 

The system of Malthus On Population. — An exposition of its formulas. — 
Exposition of its results. — Doctrine of Godwin. — It has the fault of being 
as absolute as that of Malthus. — It is more humane. — Remarkable bold- 
ness of Godwin's book. — Various writings on the same question. — New 
Ideas on Population, by Mr. Everett.— Book on Charity, by M. Duchatel. 
— Chtistian Political Economy, by M. de Villeneuve-Bargemont. — Protests 
of M. de Sismondi and of Abbe de La Mennais. 

A FEW years had elapsed since the publication of the 
work of Adam Smith, and his doctrines were already- 
adopted by the economists of all countries. His clear 
and cogent reasoning had dissipated most of the dreams 
which many minds still took for realities. There was 
at length an agreement on the fundamental bases of the 
science. Labor was restored to honor ; exchange value 
was defined ; the employment of capital was henceforth 
subject to regular laws. It was known how riches were 
produced and how consumed ; but there remained, as we 
have said, one problem to solve : Why are riches so un- 
equally distributed in the social body ! Why are there 
always unfortunates? And this problem was thrown out 
one day, by the redoubtable hand of the French people, 
as a challenge to all the governments of Europe. Tur- 
got, who had attempted to resolve it, died in the effort, 
and the French revolution had shed torrents of blood to 
find its solution, without being more fortunate than 
Turgot. 

Did the evil come from nature or from society ? Was 
it without remedy, or might one succeed in Curing it, 
with the aid of time? Impressed with what llaw« can do 

392 



THE POPULATION PROBLEM. 393 

for the morals and condition of people, some illustrious 
writers had thought that the miseries of man were his 
work, and that it only depended on him to put an end 
to them, much less by restraining his passions than by 
changing political institutions. It was 1798 : a memorable 
attempt had just been made in France, and people had 
seen, within a few years, the boldest reforms, supported 
in turn by reasoning and by force, leave the human race 
a prey to the same uncertainties and the same inequal- 
ities as in the past. The dividing up of landed property 
into small portions, had been substituted for the old 
system of concentration ; power had been bestowed upon 
the poorest masses, who had not opposed the maximum, 
nor the forced loans, nor bankruptcy, nor the suppression 
of indirect taxes ; and there were still poor people, men 
clothed in rags, old men without bread, helpless women, 
foundlings, malefactors, and prostitutes. What remained 
to do after what had been done ? What monarchy would 
attempt what the courage of 1793 had not been able to 
accomplish? Philosophers and economists, struck with 
stupor, were experiencing that bitter disappointment 
which follows political revolutions, when suddenly there 
appeared, with a brief interval between them, two writ- 
ings from two men celebrated in different ways, the book 
of Mr. Godwin on Political Justice and that of Malthus 
on Population. 

Mr. Godwin, in his work, attributed all social evils to 
the imperfection of political institutions and the faults of 
governments. Malthus was more impressed by the ob- 
stacles which man imposes in the way of social progress, by 
the passions inherent in his nature and his little disposition 
to restrain them. The reading of an article by Mr. Godwin 
on Prodigality and Avarice,"^ decided him to publish his 
ideas on this subject ; and after some retouches, easy to 
conceive in a labor of that importance, the essay on the 
Principle of Population appeared in England in the last 

* Inserted into a number of The Inquirer. 



394 HISTORY OF POLITICAL ECONOMY. 

year of the eighteenth century, as a sort of r^sum^ of the 
universal disenchantment of minds. This book created a 
great sensation, because it was based on one simple idea, 
easy to comprehend and retain ; and it has been cruelly 
abused, because it seems to favor more than one bad in- 
clination of man, egotism, harshness, and indifference to 
the suffering of his fellow creatures. The principles on 
which it rests have obtained, nevertheless, the sanction of 
several governments, and they tend so rapidly to penetrate 
into institutions, that there will soon be nothing more to 
do except to record their conquests, instead of discussing 
their value. We must, then, here set them forth undis- 
guised before examining their consequences, a double 
task which calls for all the impartiality of the historian. 

The doctrine is presented with the inflexible and abso- 
lute character of fatality. The author dispenses with 
oratorical precautions ; he establishes, without flinching, 
as an evident, constant and necessary fact, that the 
human race blindly obeys the law of indefinite multipli- 
cation, while means of subsistence do not multiply in the 
same proportion. This fact appears to him so well de- 
monstrated, that he does not hesitate to formulate it as a 
mathematical axiom ; and he afifirms that men increase 
in geometrical progression, and provisions in arithmetical 
progression. There would then come a time when pro- 
visions would be insufficient for the voyagers, if dis- 
eases, poverty and death, those sinister correctives, 
did not regularly intervene to re-establish the equi- 
librium. Malthus pronounced this sentence on the 
unfortunates, in cruel terms: " A man who is born into 
a world already full," he said,* " if his family have no 
means to support him, or if society has no need of his la- 
bor, has not the least right to claim any portion of food 
whatever, and he is really redundant on the earth. At 

* This cruel passage was suppressed by Malthus in the later editions o^ 
his book ; but the spirit of his doctrine is nevertheless summed up in it witV 
emphatic truthfulness, and it was the doctrine rather than the language tha/ 
needed modification. 



MALTHUS ON POPULATION. 395 

the great banquet of nature there is no plate for him. 
Nattirc commands him to go away, and she delays not to 
put that order into execution."* Here is the foundation 
of the doctrine of Malthus on population. Let us now 
look at the arguments by which he has attempted to es- 
tablish it. 

Instead of observing carefully what takes place in 
long-established civilized communities, the author trans- 
ports himself to America, to the United States, a virgin 
country, fertile, immense, where the population doubles 
every twenty-five years. This is the country which he takes 
for a type of the rest of the world, and he unhesitatingly 
admits that the human race would increase with the same 
rapidity everywhere else, if the force of things did not re- 
strain this development within certain limits. When 
once, in fact, the population has risen to the level of the 
means of subsistence, the latter beginning to fail, vices, 
diseases, and calamities of every kind begin to rain down 
upon the men who are redundant, according to Malthus, 
and the population diminishes until there is food for 
everybody. History in hand, he attempts to prove 
that the same consequences have always followed the 
same conditions, and that in a barbarous state as in a 
civilized, there has never been any compromise between 
famine and death. And if death only came alone ! but it 
never appears, in these sad conjunctures, without being 
accompanied by a train of crimes and horrors of every 
kind — -without raising its mournful standard over hos- 
pitals, in galleys, and over scaffolds. Thus Malthus de- 
picts it, just as we have seen it many times without 
daring to think, as he does, that it comes under that 
form, by order of God and as a necessity even of our 
social order. 

We begin by contesting the double progression estab- 
lished by Malthus : but before pointing out that funda- 
mental error of his system, let us see what terrible con- 
clusions he deduced from it. He proclaimed, to begin 



39^ HISTORY OF POLITICAL ECONOMY. 

with, the danger of alms, public or private aid, perma- 
nent or temporary ; he prohibited marriage, except to 
certain men, and he condemned to death thousands of 
children at birth. Charities bestowed on the poor in a 
religious spirit, or through love of beneficence, were in 
his eyes only murderous favors whose principal result 
was to encourage idleness and to multiply the number of 
unfortunates. " For nothing multiplies like poverty," 
he said ; " and people who have nothing to lose, care 
very little what happens to their descendants." This is 
what Montesquieu had already said in ironical terms : 
" People who have absolutely nothing, like beggars, have 
many children ; for it costs the father nothing to teach 
his trade to his children, who are from their very birth 
instruments of that trade."* But Montesquieu had 
drawn no conclusions from that general disposition of 
proletaries to unconcern : he contented himself with 
pointing it out, without investigating its cause. Malthus 
thought he had found that cause in the encouragement 
afforded to idleness by beneficence ; and, directing his 
attention to the alms-houses and foundling hospitals, he 
pointed out all the miseries which the abuse of public 
charity had engendered. He then addressed himself to 
the noblest and most generous feelings of man, and 
sought to demonstrate the superiority of prudence over 
all other resources offered to old age and infirmities. 

Never, perhaps, up to that time, had any system been 
formulated in terms so absolute. • The Economists them- 
selves admitted some modifications in their theory of the 
net product ; but Malthus knew of no possible capitula- 
tion in the struggle of men against nature ; these lamen- 
table contests must always end by decrees of death. 
He consequently undertook to preach, under the term 
moral restraint, a doctrine little favorable to marriage. 
He attempted to demonstrate to the laboring classes, that 
by multiplying the number of children, they were creat- 

'^ Spirit of the Laws, book xxiii, chap. xi. 



LAW TO LIMIT POPULATION. 397 

ing competition which would bring about a fall in wages, 
and that the surest way of bringing capitalists to terms, 
was not to furnish them a permanent opportunity of 
choosing workmen at the lowest price. It was for the 
interest of society itself to interpose salutary obstacles 
to inconsiderate unions, since the inevitable consequence 
of these unions was the multiplication of crimes and 
miseries of every kind. Unfortunately, Malthus soon 
perceived that celibacy did not prevent births ; it only 
rendered them illegitimate, and this was an additional 
misfortune. What, then must be done to put a limit to 
the increase of population, since the birth of children 
could not be prevented ? Malthus saw that obstacle, but 
was not disconcerted by it. He armed himself with 
stoical courage, and he decided that children should be 
out of the protection of the law, even before they were 
born. He proposed * that a law should be passed de- 
claring that " no child born from any marriage taking 
place after the expiration of a year from the date of the 
law, and no illegitimate child born two years after the 
same date, should ever be entitled to parish assistance." 
"This," he said, "would operate as a fair, distinct, and 
precise notice, which no man could well mistake." * * * 
" No one would be deceived or injured, and consequently 
no one would have a right to complain." So children in 
the cradle became responsible for the error which had 
brought them into the world. " Why do you shrink ? " 
said Malthus , " your charity is more cruel than my 
severity, and your foundling asylums are only catacombs." 
He at the same time unrolled the mournful tables of the 
mortality of children in these asylums, and people 
were obliged to acknowledge that they almost all died in 
their first year.f 

* Principle of Population, Book iv, chap, viii, 6th edition. 

f According to the calculations of M. Benoiston de Chateauneuf, the 
mortality of foundlings was 67 per cent at Madrid, in 1817 ; 92 per cent 
at Vienna, in 1811 ; 79 per cent at Bruxelles, on the average, from 1802 to 
1817 ; as we have already said, at the foundling asylum in Dublin, from 
1791 to 1797, of 12,785 children, 12,561 died in six years. What a slaughter 
house ! 



398 HISTORY OF POLITICAL ECONOMY. 

These terrible presentations of facts produced a great 
sensation in Europe. Malthus continued them with inflexi- 
ble persistency ; he wished to alarm humanity at their 
own errors and to force all men of heart to consider well 
their course before marrying. By suppressing the in- 
clination natural to all governments to multiply institu- 
tions of beneficence, he hoped to put a limit to the abuses 
of these institutions, which, he thought, only served to 
aggravate social maladies, instead of curing them. Celi- 
bacy, of late dishonored as a selfish condition, was re- 
stored to honor, and almost raised to the rank of a virtue. 
Hospitals and asylums were closed; people ceased to 
distribute alms ; they no longer concerned themselves in 
matters of beneficence and public assistance. Harshness 
alone was henceforward in conformity to the true princi- 
ples of science, to the laws of nature ; insensibility 
was erected into a system. It must be confessed that 
such a system must have been deeply revolting to gener- 
ous and tender souls to whom the pleasure of bestowing 
charities is a constant necessity. Consequently there 
arose on all sides a general cry of disapprobation at the 
doctrines of Malthus. The author came near being dis- 
tinguished as a man without feeling, who would im- 
pudently hurl the horrible irony of his system at. the 
human race. It was the first time, people said, that any 
one had dared thus to eulogize pestilence, war, famine, 
and all the scourges which af^ict humanity, by presenting 
them as in accordance with natural laws, and destined to 
maintain the balance between population and means 
of subsistence. Priests, women, and philosophers, re- 
volted at the audacity of such a supposition ; and Mal- 
thus, notwithstanding his private qualities, was, in con- 
sequence, long exposed to the most calumnious imputa- 
tions. 

The storm has at length abated above the grave of 
this great writer, and posterity have begun to do him 
justice. He himself acknowledged, in his latter days, 



THE ERROR OF MALTHUS. 399 

that he had overstated thef consequences of his princi- 
ple. " It is very probable," he said, " that having found 
the bow too much bent in one direction, I was led to 
bend it too much in the other, with the view of making 
it straight ; but I shall always be disposed to eliminate 
from my work that which shall be considered, by com- 
petent judges, as having a tendency to prevent the bow 
from righting itself, and to put any obstacle in the way 
of the progress of truth." And, in fact, we have seen 
that he suppressed, in the later editions of his book, the 
harshest and most revolting passages. His principal 
error lay in attributing the evils of humanity almost 
exclusively to the too great multiplication of the race, 
and in having, so to speak, absolved in advance the gov- 
ernments of all countries, from reproach. Moral causes 
are ordinarily complex, and they cannot be known by 
looking at them from a single side. Neither did Malthus 
take sufificient account of the increase in the means of 
production, under the influence of labor and by the co- 
operation of machines. He pretended not to perceive 
that the population of our time, though infinitely more 
numerous than that of past times, enjoyed nevertheless 
many comforts, were better clothed, better lodged, 
better fed, and less exposed than ever before to the 
danger of devouring one another. Perhaps they expe- 
rience more of moral suffering from the greater number 
of temptations which cannot always be gratified ; but 
these very temptations are an energetic stimulant to which 
we must refer a good part of the progress that has been 
made in all branches of industry. Accepting the hy- 
pothesis of Malthus, yet as population approaches 
the level of means of subsistence, the demand for new 
products leads to useful discoveries by which all humanity 
profits ; emigrations lead human races by degrees towards 
the unoccupied regions, which become fertile as they be- 
come populous, and civilization thus penetrates into un- 
known countries, which return a hundred fold the advances 



400 HISTORY OF POLITICAL ECONOMY. 

necessitated in working them. Thus North America 
has seen its prairies and its woods tilled by European 
colonists, and the valleys of its great rivers covered with 
opulent cities, where lately wandered miserable hordes of 
hunters and cannibals.* 

When one examines with some attention the map of 
the globe and considers the fertility of a great number of 
regions scarcely explored, he ceases to fear for the human 
race the evils with which it is threatened by the predic- 
tions of Malthus. Emigration even appears only as a last 
resource, in view of the improvements which the genius of 
man never fails to lavish on the earth, because new profits 
appear in proportion as it is called upon to satisfy new 
demands. Mr. Ricardof has left the opponents of Mal- 
thus nothing to desire on this point, and we are per- 
suaded that tliQ author of the book on Population must 
have been himself reassured against the consequences of 
his own system, on appreciating at their just value the 
fine analyses of agricultural progress presented by his 
illustrious fellow-countryman. Besides, a continual ex- 
change of manufactured products for natural products 
is going on among all nations, so that commerce remedies 
the insufificiency of agriculture and never leaves any in- 
telligent and industrious people without means of sub- 
sistence. The daily increasing intimacy of the relations 
between civilized nations, renders all useful discoveries at 
once common to them ; for example, steam navigation, 
gas illumination, and railroads, which we have seen almost 
simultaneously adopted in Europe, Asia, America, and 
even Africa. So to-day steamboats plough the Red Sea 
and the Adriatic, ascend the Nile, the Ganges and the 
Mississippi, as well as the Seine and the Thames, and 
bring to our populous cities, in case of dearth, wheat from 
the Black Sea and from the United States. Malthus was 
not the iirst to utter a cry of alarm on the subject of the 

* V. art. anthropophagi^ Encyc. Brittanica. — Trans. 
\ In his work on the Principles of Taxation. 



RESULTS OF THE WORK OF MALTHUS. 401 

increase of population, and we might cite more than one 
writer of his country, who deplored, a hundred years ago, 
in the style of Jeremiah, the immediate dangers of that 
increase. What would those prophets of misfortune have 
said could they have beheld the England of our day, rich, 
powerful, and twice as populous as then ! 

The doctrine of Malthus will nevertheless have the 
merit of having called the attention of governments, 
as well as of citizens, to the danger of improvident 
unions and of aid bestowed without discretion. That 
dbctrine has already kept France from imitating the 
vicious laws which have created in England the poor- 
tax, and which have made of beggary a remunerative 
occupation. Even in the country where these laws have 
so long had sway, they have just been modified ; and 
public generosity, henceforward enlightened by the ex- 
perience of the past, is learning to distinguish unmerited 
misfortune from voluntary poverty. Christianity, as we 
have said, discovered beneficence ; political economy has 
systematized it. Prudent men have also learned to re- 
flect on the consequences of marriage ; and this solemn 
act of life has ceased to be considered as lightly as it 
was, before Malthus had caused an appreciation of the 
immense responsibility which it imposes. Society, in 
showing itself more strict in the distribution of public 
aid, has put upon every citizen the responsibility of pro- 
viding for himself by saving up for the necessities of his 
old age or his days of suffering ; and if it has not yet 
ventured to follow the advice of Malthus and close the 
asylums now open to deserted children, it has, at least, 
taken measures to recall a greater number of mothers to 
their natural duties, which they neglected less frequently 
from any fault of heart than from the influence of pov- 
erty. We must then pardon Malthus for having struck 
hard instead of striking justly, and for having bent the 
bow too much to one side, as he himself said, in order to 
make the other right. He yielded to the very natural 



402 HISTORY OF POLITICAL ECONOMY. 

impulse of generalizing a simple and striking idea and 
throwing it out like a spectre before a frightened world. 
His aim was to profit by the fear such an idea would in- 
spire, to arouse in his contemporaries greater activity in 
all things, and to demonstrate to them the economic 
sense of the menacing cry of Bossuet : " Advance ! Ad- 
vance ! " 

We have seen that Malthus was drawn into the publi- 
cation of his work by reading the political writings of 
Mr. Godwin, that energetic utopist who would make 
governments exclusively responsible for all the imper- 
fections of humanity. This was also the teaching of J. 
J. Rousseau, and he expressed it in dogmatic terms when 
he said • " Everything is good when it comes from the 
hands of the Creator ; everything degenerates in the 
hands of man." Condorcet had been still bolder, and 
had not hesitated to affirm that if man would follow 
nature, he would indefinitely extend the limits of his ex- 
istence on the earth. Godwin imagined that he was only 
drawing the natural conclusions from their ideas by pro- 
posing the destruction of governments, religions, prop- 
erty, marriage, and institutions of less importance which 
are derived from these. We must recur to these ex- 
aggerations, in order to explain the exaggeration in the 
system of Malthus. " Though human institutions," says 
the latter, " appear to be and indeed often are, the obvious 
and obtrusive causes of much mischief to society, they 
are in reality light and superficial in comparison with 
those deeper-seated causes of evil, which result from the 
laws of nature and from the passions of mankind." * " Far 
from the evils of humanity being due to the incapacity 
of governments and their repugnance to reforms, it is 
rather to excess of population that we must attribute all 
the evils with which humanity is oppressed. The am- 
bition of princes would lack for instruments of destruc- 
tion, if poverty did not drive the lower classes of the 

* Principle of Population, Book iii, chap. ii. 



RECEPTION OF MALTHUS DOCTRINE. 403 

people to their standards." Malthus thought that the 
multitude, incessantly goaded on by distress, could be re- 
strained only by the harshest despotism. In his opinion, 
the shouts of demagogues rallying to the aid of the 
established power the comfortable classes of the society 
whose existence they threatened, were the cause of all 
the bad laws and of the continuance of all abuses. He 
could not conceive that an enlightened nation could long 
endure bad institutions and the malversation of a cor- 
rupt government, if it did not think itself threatened 
with evils more serious by a blind and famished populace.* 
It is easy to conceive with what favor this doctrine 
would be received in a country like England, whose aris- 
tocracy were maintaining, at the time when the book by 
Malthus appeared, a fierce contest against the principles 
of the French revolution. Babeuf had not yet written ; 
but people remembered the pamphlets of Marat, and the 
sanguinary attempts of our levelers. They had seen the 
reformers of that school at work, and the general senti- 
ment of horror they had inspired contributed not a little 
to the success of the doctrine of Malthus. His theory 
of population was extolled with partisan enthusiasm, for 
it placed under the protection of Providence, as its work 
indeed, the greatest social inequalities and all the miser- 
ies which they entail. The popular writers ranged them- 
selves on one side, the advocates of privileges on the 
other, the former to attack, the latter to defend, this 
new dogma of fatality. It was no longer a discussion, it 
was a fight, from which truth would have had much dif- 
ficulty in coming forth safe and sound, if time, which 
puts everything in its proper place, had not forced the 
parties to acknowledge at last what was unreasonable in 
their respective pretensions. Godwin was already much 
more moderate in his Inquiry concerning Population than 
in his treatise on Political Justice ; and Malthus himself, 

* Ch. Comte, '' Histojic Notice on the Life and Labors of Malthus" 
read at the Institute, Dec. sSth, 1836. 



404 HISTORY OF POLITICAL ECONOMY. 

as we have said, had amended his views, in consideration 
of competent judges^ that is to say, of the events which 
had modified his ideas. 

His doctrine, in fact, could not bear a serious examina- 
tion in the absolute terms in which he had stated it. 
Those decrees of proscription issued against children, 
against the aged and infirm, did not merit the sanction of 
the public conscience. A voice within each man cried 
out that the most imperious and the most tender of all 
feelings, those of love and paternity, had not been given 
him by the Creator as a source of bitterness and of mis- 
eries. Vices and crimes could not have the same origin 
as virtues. The most simple analysis of human labor 
was sufficient to demonstrate, on the other hand, that if 
the increasing population demanded a greater quantity 
of means of subsistence, it possessed in itself the power 
of providing it. People saw every day a single man cre- 
ate by his labor enough products to support ten of his 
fellow creatures. New lands were brought under culti- 
vation whenever the demand for food assured regular 
profits to agricultural capital. The laws in favor of the 
poor, which Malthus had pointed out as so pernicious,* 
were to be considered only as a compensation for the 
alms bestowed by the monasteries, whose revenues Eng- 
lish Protestantism had confiscated, and not as an encour- 
agement to vice and idleness. It was in vain for the au- 
thor to say: "It is- necessary to leave to nature the 
care of punishing the poor for the crime of poverty ; " no 
one regarded poverty as a crime and wealth as a virtue. 

Mr. Godwin refuted with great superiority of reason 
all that part of the doctrine of -Malthus, which had been 
so well received by the English aristocracy, because 
it accorded perfectly with their natural sympathies. 
"Woe to the country," he says, " in which a man of this 
class " {i.e.^ the people) " cannot marry, without the 

* Malthus called these laws "an evil in comparison with which the na- 
tional debt, with all the terror it inspires, is but of little importance." 



A. EVERETT ON POPULATION. 405 

prospect of forfeiting his erect and independent condi- 
tion! Woe to the country, in which, when unforeseen 
adversity falls upon this man, he shall be told he has no 
claim of right to be supported and led in safety through 
his difificulties ! We may be sure there is something dis- 
eased and perilous in the state of that community, where 
such a man shall not have a reasonable and just prospect 
of supporting a family by the labor of his hands and the 
exertions of his industry, though he begins the world 
with nothing."* 

Experience has not ceased to justify this opinion. 
Public wealth continues to increase in almost all the 
countries of Europe at the same time with the popula- 
tion ; and this phenomenon is reproduced in so general 
and decided a manner, that an American economist, Mr. 
Alexander Everett, has even gone so far as to consider 
the increase of population as the essential cause of every 
kind of progress. He judges that since the products of 
labor are always in the ratio of labor itself and conse- 
quently of population, the means of subsistence for indi- 
viduals depend only on the more or less equitable divis- 
ion of the profits between those employed in the various 
branches of industry These industries themselves be- 
come daily more developed upon a limited territory, 
either by the perfecting of agriculture, or by the exten- 
sion of commerce. The young branches, far from ex- 
hausting the trunk, give it a new vigor and become ele- 
ments of prosperity, instead of being, as Malthus sup- 
poses, a cause of ruin and decay. 

For the rest, the errors relating to the development of 
population date from a time much anterior to the pub- 
lication of the celebrated work of Malthus. The old 
writings on political economy all bear the impress of the 
uneasiness of our fathers at the sight of the great family 
which they also contributed so valiantly to increase. 
Their cries of distress were heard principally in the chief 

* Inquiries into Population, book vi, chap. vi. 



406 HISTORY OF POLITICAL ECONOMY. 

cities ; and more than one king of France, in desperation, 
thought necessary to restrict the extent of the city of 
Paris, whose constantly retreating boundaries are still 
tending to enlarge. The same phenomenon has been ob- 
served in London, a city as populous as certain kingdoms, 
and in which more than a million consumers live at ease 
on a space which would not suffice for the support of 
five hundred persons, if it was destined to furnish it.* 
But these vain fears disappear before the absurdity of a 
pretended increase of population in geometrical progres- 
sion. Malthus himself recognised that one could cite no 
nation whose population has not been maintained, by 
physical or moral influences, below the level fixed by the 
products of the soil ; without which we should have seen 
permanent dearth, or periodic epidemics, while these 
scourges have generally appeared only at times when the 
various nations were much less populous than at present. 
The choice that Malthus made of America, where the 
population doubles every twenty-five years, is not more 
conclusive than that of Sweden, where, according to Mr. 
Godwin, it doubles only in a hundred years. Communi- 
ties do not proceed thus by regular periods, like the stars 
and seasons, as we have said ; and political institutions, 
as well as the habits of the people, exercise an influence 
which greatly modifies the natural tendency, arithmet- 
ical or geometrical, of man to multiply. 

It was then in vain that Malthus declared war on the 
home affections, on public and private charity, on child- 
hood and on old age, in the wrongly understood interest 
of humanity. Heaven did not decree that wealth should 
have the monopoly of all enjoyments, including those of 
love and marriage, nor that one part of the human race 
should be sacrificed as a holocaust to the other ; in a 
word, society should no more be a convent than a warren. 
However, by exaggerating the dangers of population, 

* Written in 1836. The population of London is now, 1880, ovei 
4,000,000. 



SERVICE OF MALTHUS. SISMONDl'S LAW. 407 

Malthus at least warned governments against the abuses 
of beneficent institutions, and made every man feel that 
the social law imposed upon him sacred duties of fore- 
thought in providing for himself and his children. Eng- 
land beg^n, from this time, the reform of her poor-laws, 
and other countries have guarded against the danger of 
imitating these laws. Charity will not, hereafter, be less 
earnest, but it will be more enlightened. It will consider 
itself subject, like all other virtues, to rules ; and these 
rules have already been marked out for it, in France, in a 
work* which partakes at the same time of the severe 
prudence of Malthus a7td the generous philanthr op hy of God- 
zvin. We might add that that way appeared unsatisfac- 
tory to religious minds, to whom beneficence is the most 
holy of duties. One of our most honored magistrates* 
has published under the title of - Christian Political 
Economy," a manifesto often eloquent and always sin- 
cere, against the doctrines of Malthus. He attacks them 
doubtless much more as an apostle than as an economist 
and statesman ; but he has well shown their powerless- 
ness to make the people moral and to prevent an in- 
vasion of the miseries with which humanity is afflicted 
Several years before the appearance of his book, a pro- 
test which created some sensation in Europe, had pointed 
out for public animadversion the doctrine of the unlimi- 
ted labor of workmen and the right of abandonment ex- 
ercised in reference to them by masters. M. de Sis- 
mondi had not hesitated to propose a law in virtue of 
which employers should be held to provide for all 
the needs of their workmen, in health, in sickness at 
all ages of life, on condition that the latter could marry 
only with the authorization of the former. He was thus 
going back to the wardenships and masterships, and de- 
manding of the working classes their liberty in exchange for 
their bread ; so serious and dif^cul t is the question, so 

* Charity, by M. Duchatel. ' " ' 

* M. de Villeneuve Bargemont, a former prefect. 



408 HISTORY OF POLITICAL ECONOMY. 

alarming is it, when one recalls the attempts of 1793 and 
the sufferings of 1830; of the Luddists at Manchester and 
the insurrectionists at Lyons. 

All the governments of Europe have not ceased to 
struggle, since that time, against the principle af disorder 
and perturbation which the unsettled condition of that 
question everywhere involves. In vain has production 
advanced with giant strides ; markets do not always 
offer it a favorable outlet, and the distribution of profits 
is not made with that evident equity which rallies all con- 
victions and all interests. . The moral restraint of Mal- 
thus does not hinder one single imprudent marriage, nor 
prevent any illegitimate birth. The counsels of M. Du- 
chatel are addressed only to intelligent men, and the in- 
tervention of the law, as M. de Sismondi demands, is not 
less rejected by our institutions than by our customs. 
The discussion in regard to it is still at the point where 
Malthus left it ; and although that author may have- 
found, like Turgot, a government disposed to favor his 
experiments, these experiments are not yet sufficiently 
conclusive for us to hope from them a truly scientific 
and decisive solution. We shall soon see deliberative as- 
semblies at the work, bold innovators who will attempt 
to untie the gordian knot and to establish a distribution 
of the profits of labor on better bases: the Constituent 
Assembly, the Convention, the Saint-Simonian school, 
the Socialist school, and many others. In what have 
their great attempts advanced us ? We hear rumble, like 
a voice from the depths, the austere words of M. de La 
Mennais, the Father Bridaine'^ of political economy ; but 
he complains of the workmen as much as of the masters ; 
he contents himself with recommending charity to the 
latter and resignation to the others. His vehement para- 
bles sometimes recall the Philosophic and Political History 
of Abbe Raynal ; but the disasters of Saint-Domingo are 
no longer forgotten. It was not the feverish eloquence of 
Raynal which emancipated the blacks ; it was the reason 
of Wilberforce and the wisdom of the English Parliament 



CHAPTER XXXVI. 

Influence of the writers of the eighteenth century on the progress oi 
political economy in Europe. — Spirit of the Laws. — Economic works of 
J. J. Rousseau. — Economic opinions of Voltaire. — Abbe Raynal. 

It is just to give the philosophers of the eighteenth 
century a part of the honor which accrues to the Econo- 
mists for all the reforms carried out or attempted in the 
latter part of this century. Their writings contained 
the germs of them, and although a vague uncertainty 
is manifest on most of the social questions so boldly 
approached by the schools of Quesnay, Adam Smith and 
Malthus himself, we can but acknowledge that Montes- 
quieu, Rousseau, Voltaire, and the abbe Raynal were the 
precursors of these great masters in economic science. 
The great renown of the literary works of the Encyclo- 
pedists, seems to have exclusively absorbed the atten- 
tion of posterity ; but the part which escapes us to-day, 
that which is least read, is the true starting point of all 
the modern economic theories. There they are in an 
embryonic state, all ready to be born under the hot 
atmosphere of the French Revolution ; and the least 
practiced eye is sufificient to recognize them and note 
their signs. 

Montesquieu occupies the first rank among the publi- 
cists who have turned their attention to the most pro- 
found questions of political economy ; and although he 
often makes mistakes, although he has shared in many 
respects the prejudices of his contemporaries, we are 

409 



410 HISTORY OF POLITICAL ECONOMY. 

indebted to him for the first truly new and bold views 
which have been published on the influence of commerce, 
and for some careful analyses of the theory of moneys. 
What more true, even to-day, than this fine appreciation 
of the character of imposts : " A poll-tax is natural to 
servitude ; a tax on commodities is more natural to free- 
dom, because it has a less direct connection with the 
person." It was Montesquieu who first dared to say that 
the freest governments were also the dearest ;* and if that 
doctrine is true in our days, for other reasons than those 
of which this great man spoke, he nevertheless has the 
merit of having discovered it. He began by going for- 
ward ; later, the movement was explained. 

We vigorously attacked, thirty years ago, the colonial 
system and the trade in blacks ; but, apart from the act 
of affranchisement passed by the English parliament, 
what is there anywhere more eloquent than the chapter 
of Montesquieu on negro slavery ! " Those whom we 
are considering," he said,* " are black from head to foot, 
and the noses are so flattened that it is almost impos- 
sible to pity them. One cannot bring himself to believe 
that God, who is a very wise being, can have put a soul, 
especially a good soul, into a body wholly black .... It 
is impossible for us to suppose these people to be men, 
because if we suppose them men, people would begin to 
think that we ourselves are not Christians. Small minds 
exaggerate too much the injustice done to the Africans: 
for, if it were such as they say, would it not have entered 
the head of the princes of Europe, who make so many 
useless agreements among themselves, to make a general 
one in favor of mercy and pity ! " This agreement 
has been made, thank God ; but who would deny that 
it is mainly due to the sublime irony of the plea of 
Montesquieu ? Political economy has proven the dear- 
ness of the labor of the negroes, and the superiority of 

* Spirit of the Laws, Book xiii ; chap. 12. 

* Spirit of the Laws, book xv, chap. v. 



MONTESQUIEU ON COMMERCE. 411 

cultivation by free hands. Montesquieu did better- he 
inspired a horror of slavery ; he stigmatized it, he branded 
It on the forehead; legislators had only to record his 
decree. The Spirit of the Laws had already settled that 
grave question, much before the declamations of Raynal 
and the decrees of the Convention. 

I hasten to pay Montesquieu the debt of science 
and of the present time. Listen to his definition of com- 
merce, which one might think taken from some discourse 
from the throne, this year, in France or England- " The 
natural effect of commerce is to tend towards peace 
Two nations which trade together render themselves 
reciprocally dependent; if the one has interest in buying 
he other has interest in selling, and all unions are' 
founded on mutual need." Is not this, in brief, the pro- 
gramme of modern policy.? We are taking great steps 
towards the realization of this grand harmonic thou<.ht 
that It was given to Montesquieu to enunciate, without 
being able to demonstrate its correctness. This task 
devolved on the economists, and never, perhaps, were 
their labors more clearly distinct from those of the phi 
losophers of the eighteenth century, than in everything 
connected with this subject. In fact, Montesquieu 
has_ no sooner explained the true bases of the trade of 
nations, than the demonstration escapes him and he falls 
into the most serious contradictions.* ' - Freedom of 
trade is not," in his eyes, ''an opportunity given mer- 
chants to do what they may wish ; it is rather a servitude 
What injures the merchant is not for that reason injuri- 
ous to commerce." Further on, he adds: " The state 
must be neutral between its custom-house and its com 
merce and must so act that these two do not conflict 
and then people there enjoy commercial freedom " The 
Zf^^^fon^^^^^^^t^n^A instinct of this illustrious writer 



412 HISTORY OF POLITICAL ECONOMY. 

made him divine the true principles, and the prejudices 
of his time concealed them at times from his view, as 
witness his opinion on importations and exportations, 
marred by the oldest errors of the balance of trade. " A 
country," he says, " which always sends less merchan- 
dise than it receives, brings about a balance by impov- 
erishing itself ; it will always receive less, until, in extreme 
poverty, it no longer receives anything." 

This strange assertion is found, it is true, in a chapter 
entitled : " To what Nations it is Disadvantageous to 
Carry on Trade ; " and Montesquieu there designates 
Japan as one of the countries with which there are the 
fewest disadvantages in trading, " because the excessive 
quantity of that which it can receive, produces the exces- 
sive quantity of that which it can send : " but we can 
but regret that such errors mar a work whose publication 
has rendered so many services to society. In another 
place,* the author exclaims: " It is not for me to pro- 
nounce on the question whether, if Spain is not able to 
trade with the Indies herself, it would not be better 
for her to make the trade free to foreigners. I will 
simply say that it will be well for her to put the fewest 
obstacles that her policy can permit, in the way of this 
trade." Thus it was, that, possessed in turn by contrary 
ideas, Montesquieu defended freedom and prohibitions, 
and that his works have served as an arsenal to all philo- 
sophical, economic and political parties, because argu- 
ments are found in them for all causes, as at the time of 
fermentation, we see the lees bubble up with a mass of 
impure products, mingled with the most generous liquor. 
It was difficult not to confound many different things, in 
stirring them up in so lively a manner as did the im- 
mortal author of the Spirit of the Laws, and this con- 
sideration well explains why it has not been given to the 
same men to propose questions and to resolve them. The 
Philosophers of the eighteenth century only obscurely 

* Esprit des Lois, Book xxi, chap. 23. 



ROUSSEAU'S ECONOMIC IDEAS. 413 

saw the solution of the social problem through the prism 
of their imagination, and, as it were, like poets: the 
Economists alone applied to it the experimental method, 
and it was, in fact, only in their hands that political 
economy became an experimental science. 

One finds in the economic works of J. J. Rousseau the 
same contradictions and the same uncertainties as in Mon- 
tesquieu. Like him, he makes war on luxury, and he 
devotes himself chiefly to extolling the marvels of agri- 
culture. Commerce and finance seem to him adapted 
only to enervate people and to corrupt them. " When 
one wishes only to win," he says, " he always wins more 
by being a knave than an honest man. Those who handle 
money soon learn to embezzle it, and what are all the 
inspectors appointed over them, but other knaves sent to 
divide with them ? " To avoid this fatal management, 
J. J. Rousseau proposed to pay public functionaries in 
commodities, and to have public services performed by 
means of corvees. This, in his estimation, was the spirit 
which should prevail in a good economic system: "To 
think little about foreigners, to care little for commerce, 
to suppress stamped paper, to tax live stock, and especially 
to tax the land, as the Physiocrates proposed, because, in 
short, it is that which produces which ought to pay'' And 
yet the tax on lands was to be, in his view, only an excise- 
tax, {inise en regie), in order that the state should have 
money without the citizens being obliged to give it. 

This economic policy was the natural consequence of 
the famous paradoxes of which Rousseau never ceased to. 
be the eloquent propagator. It led straight to the regime 
of Sparta and the laws of Lykurgus. " Cultivate," he 
said, " the sciences, arts, commerce, and manufactures : 
have regular troops, fortified places, academies, above all 
a good system of finance which will make money circu- 
late well, which will procure you much of it ; in that way 
you will form a people who will be intriguing, ardent^ 
covetous, ambitious, servile and knavish, like others ; you 



414 HISTORY OF POLITICAL ECONOMY. 

will enter into all the political systems, nations will seek 
alliances with you, and will make treaties with you ; there 
will not be a war in Europe into which you will not 
have the honor of being thrust. But if, perchance, you 
prefer to form a nation free, peaceable and wise, apply 
your people to agriculture and the arts necessary to life ; 
render money contemptible and if possible useless." It 
did not occur to Rousseau, that, to make people culti- 
vate the arts necessary to life, capital was needed, as it is 
needed for agriculture itself, unless it be carried on by the 
patriarchal system of the heroic timfes and of small coun- 
tries. It is not sufficient to exclaim : " Cultivate well 
your fields without concerning yourself about the rest; 
soon you will harvest gold, and more than you need to 
procure what you want : " this result, in fact, can be 
obtained only by commerce and by speculations which 
call for large capital. The Genevan philosopher was also 
led by his system to demand the suppression of cities, 
that is to say, of civilization itself, against which he had 
opened hostilities in that memorable discourse which was 
crowned by the academy of Dijon. 

Rousseau desired taxes on commodities, as we lately 
had on gaming-houses ; then he bethought himself of the 
smuggling it would occasion, and he proposed, in order 
to avoid it, to exempt from all duty laces and jewels, 
which were too easily concealed. A sad means for pre- 
venting that inequality of conditions, whose phantom 
terrified him, and which is inherent in civilization itself! 
" If, for example," he said,* "government can interdict 
the use of carriages, it can, with still more reason, impose 
a tax on carriages ; a wise and proper way of censuring 
their use without abolishing it. Then the tax may be re- 
garded as a sort of fine whose amount compensates for 
the abuse which it punishes." Who would suppose that 
after that sally, worthy of an old Roman censor of the 
sternest days of the republic, Rousseau would have taken 

* On Political Economy, the latter part of the article. 



VOLTAIRE'S ECONOMIC THEORIES. 415 

up the defence of governments against certain econo- 
mists who wished to exclude them from any participa- 
tion in the industrial affairs of the state ! " Such ideas 
must be rejected. If, in each nation, those to whom the 
sovereign commits the government of the people were 
their enemies on account of their position, there would not 
be the trouble of seeking what they should do to render 
them happy." * And he was right. What then must we 
conclude from that incoherent amalgamation of doctrines 
liberal almost to anarchy, and, as is said to-day, govern- 
mental even to arbitrariness ? That the true principles 
of social physiology were still little known, because the 
decisive experiments were not yet made, and political 
economy was still to the finest geniuses a science of im- 
agination. 

The incursions of Voltaire into the domain of political 
economy, offer us new evidence of this truth. In 
attacking the theories of others, he had occasion to ex- 
pose his own on these grave matters, and I regret to 
say that he has confined himself to laying the varnish of 
his elegant prose over the most superannuated common- 
places of his epoch. His Homme aux quarante Ecus\ 
{Man with forty crowns. — Trans.), composed for the pur- 
pose of ridiculing the Physiocrates and especially their most 
able interpreter, Mercier de la Riviere, is only a spirited 
reproduction of all the prejudices in favor of the balance 
of trade and of prohibitions. In it, Voltaire maintains 
that the humble live only from the luxury of the great, 
and he thinks, like Louis XIV, that princes are giving 
alms in expending largely. '' Everywhere," he says,* 
" the rich give support to the poor. That is the only 
source of manufactures and commerce. The more indus- 

* This is the last sentence of his article Economic Politique, in the £71- 
cyclopMie. 

f The economists had claimed that, in a state organized according to their 
doctrines, an average sum of 120 francs (forty crowns) would suffice for the 
subsistence of every citizen. Hence the title which Voltaire gave to his 
burlesque refutation of their system. 

* See L' Homme mix qitarante Ecus, vol. xiv, p. 12, edition of Dupont. 



4l6 HISTORY OF POLITICAL ECONOMY. 

trious a nation is, the more it gains from foreigners. If 
we take from foreign countries ten millions a year for 
the balance of trade, in twenty years there would be two 
hundred millions more in the state. But it is not certain 
that the balance of our trade will always be favorable to 
us : there are times when we lose. I have heard much 
talk about population. If we should have double the 
number of children that we do ; if we had forty millions 
of inhabitants instead of twenty, what would happen? — 
It would come to pass that each one would have only 
twenty crowns to expend, or it would be necessary for 
the earth to produce double what it does, or there would 
be double the number of poor, or there would have to 
be double the amount manufactured and double the 
amount obtained from foreigners, or half the nation would 
have to be sent to America, or one half the nation would 
eat the other." 

Although these lines are very light, they nevertheless 
contain a summary of the economic doctrines in favor at 
the time when the first writings of the Physiocrates ap- 
peared. This was the sentiment of the time throughout 
almost all Europe, and Voltaire was only the echo of 
his contemporaries, when he wrote in his defence of the 
worldling : 

" Sachez surtout que le luxe enrichit 
Un grand Etat, s'il en perd un petit. 
Cette splendeur, cette pompe mondaine, 
D'un regne heureux est la marque certaine. 
Le riche est ne pour beaucoup depenser ; 
Le pauvre est fait pour beaucoup amasser. " * 

It is far from these elastic doctrines to the fine analyses of 
production by Adam Smith ; but it was much that people 

* Literally translated : 

" Know above all that luxury enriches 
A great State, if it ruins a small. 
This splendor, this worldly pomp. 
Is the certain mark of a happy reign. 
The rich man is born to spend much ; 
The poor is made to amass much." 



ECONOMISTS AND PHILOSOPHERS COMPARED. 417 

accorded them so much of a place in all works of any 
importance, and that the finest talents in our literature 
had become their organs. When the founders of the 
science put their hand to the scattered materials in the 
books of the Philosophers, they found public opinion 
prepared for discussions of social interest, and they 
had only to speak to find hearers. Mercier de La Ri- 
viere was certainly less eloquent than J. J. Rousseau, and 
certainly Adam Smith was not so great a writer as Mon- 
tesquieu ; but these Economists had the advantage over 
the Philosophers of a closer logic and of a method more 
certain and more solidly grounded on facts. This gave at 
once a peculiar character of gravity to their works, better 
received by governments than the works of the Encyclo- 
pedists, those bold railers, who seemed more occupied in 
destroying than in reforming. The triumph of the latter, 
too, preceded by some length of time that of the Econo- 
mists, and the political revolution of which they were the 
first apostles, had time to make the circuit of the world, 
before the economic revolution had more than chosen its 
first battle fields. Civil and religious freedom is assured in 
almost all Europe ; commercial freedom is yet to be born. 
There are laws to protect political rights ; there are none 
for industrial rights. Nations .respect an acre of snow 
on the boundary which separates them, and they steal 
without shame literary property, as filibusters might do. 
Here, enormous taxes weigh heavily upon commerce ; 
elsewhere, commerce is less taxed. We have seen sov- 
ereigns pretend to exclusive domination over the mouth 
of a river; others decree to close the seas, interdict ports, 
debase coins : all is still anarchy in production, while order 
reigns in politics. 

Raynal is the first economic writer of the eighteenth 
century whose works present a picture of that interior 
struggle of the two revolutions. We feel, in reading 
him, that he worked in preference for the political revo- 
lution. He declaims like a tribune of the people; he 



41 8 HISTORY OF POLITICAL ECONOMY. 

apostrophizes, he inveighs, in the manner of demagogues; 
but his vehement philippics against the trade in blacks 
and his animated pictures of monopoly and its conse- 
quences in the two Indies, assign him a respectable place 
among the founders of industrial and commercial eman- 
cipation. Although his views are at times somewhat 
vague and incomplete, Raynal foreshadowed the economic 
revolution of the nineteenth century, of which the inde- 
pendence of the United States forms the first episode. 
One sees that he has dreamed of happier days for the 
laboring classes, whether he depicts them to us roving on 
a vessel, or shut up in a workshop, or grows indignant at 
the abuses of European power toward the weak races of 
the American continent. He is scarcely ever read to- 
day ; his writings are treated as scaffoldings which the 
architect takes down and removes as his edifice rises ; 
but the Philosophical History will remain as a souvenir of 
the first efforts consecrated to the defence of labor and 
the regeneration of the laborers. This book seems writ- 
ten in the breach ; there prevails throughout an impetu- 
osity of style which announces the approach of revolu- 
tions ; it is a last challenge hurled before the combat. 
It remains for us to see the combatants at the work ; a 
sublime and convulsive work where everything becomes 
an instrument of war and of destruction ; where phi- 
losophy itself finds it necessary to have recourse to the 
axe to clear the land on which our children will be called 
to build. 



CHAPTER XXXVII. 

The economic doctrines of the French Revolution. — They have all a 
social rather than an industrial character. — They are cosmopolitan in theory 
and restrictive in practice. — The Convention and the Empire make of them 
weapons of warfare. — General view of the consequences of the continental 
blockade. — It existed in fact before being decreed. — Injurious prejudices it 
spread in Europe. 

There is a celebrated saying of the Abbe Si^yes which 
very well characterizes the tendency of political economy, 
at the beginning of the French Revolution : "■ What is the 
third estate ? " he said. " Nothing." " What ought it to 
be?" " Everything." This profound expression summed 
up the judgment of the eighteenth century ; it restored to 
honor the forgotten programme of Turgot and announced 
the advent of the power capable of carrying it into effect. 
Hardly were these words pronounced, when the work was 
begun ; and in a session of a few months, the Constituent 
Assembly had done justice to privileges, destroyed in- 
ternal customs duties, mitigated the system of frontier 
duties, suppressed corporations, subjected all citizens to 
the payment of a tax and prepared the way for the eman- 
cipation of labor. Never at any other epoch had people 
made such a harvest of inveterate abuses, and manifested 
so firm a disposition to march boldly on in the way of 
reforms. The s6cial edifice was, so to speak begun again 
at the foundation, and there was not one single im- 
portant institution which was not more or less profound- 
ly modified. 

The immortal night of the fourth of August, 1789, 
saw most of these memorable changes effected. A few 

419 



420 HISTORY OF POLITICAL ECONOMY. 

hours sufficed for the abolition of the wardenships of 
trade corporations, of mortmain, feudal rights, privileges 
of birth, and fiscal inequalities. At the same time, the 
, Constituent Assembly laid the foundations of a territorial 
division which destroyed the privileges of the provinces, 
while creating national unity. France could henceforth 
advance as a single man towards the new destinies which 
the revolution had just opened to her. Labor was free; 
the citizens were so likewise ; no career was closed to 
their capacity, no hope interdicted to their ambition. 
The central government, vigorously organized, could have 
its orders executed from one extremity of the kingdom 
to the other. The experiments decreed at Paris encoun- 
tered no serious opposition in the departments ; and thus 
began that series of more or less fortunate attempts which 
have furnished economists and statesmen with so many 
subjects of study and meditation. 

There was everything to do in matters of industries 
commerce, and finance : the Constituent Assembly boldly 
put its hand to the work. The suppression of corpora- 
tions was followed by the creation of patents : the aboli- 
tion of internal customs duties was accompanied by a 
mitigation of the system of exterior customs ; the land- 
tax was based on the principle of the equality of all 
Frenchmen before the law. There were doubtless 
many errors committed in that period of bold attempts, 
too often effected in the midst of the greatest political 
excitement ; but those errors have become for us grave 
matters of instruction, and conscience profits by them 
to-day, as by a light-house destined to warn us against 
new shipwrecks. Still, however bold and original were 
the reformers of 1789, they were too m.uch imbued with 
the principles which prevailed at that time in the philo- 
sophic and economic world, not to yield to their influence 
when an opportunity presented itself to make application 
of them. Thus, the ideas of the Physiocrates decided 
the Constituent Assembly, in spite of the wise remon- 



REFORMS OF I/Bp. ASSIGNATS. 42 1 

strances of Roederer and a few advanced spirits, to con- 
centrate the whole burden of the taxes on landed prop- 
erty. It was with reluctance that they consented to add 
to this the tax on personal property and the custom- 
duties. France was deprived, at one stroke of the pen, 
of the immense resources she could have derived from 
contributions imposed on all producers who were not 
living on their annuities, and she was soon obliged to seek- 
in the assignats a compensation for this voluntary deficit, 
added to the deficit of the old monarchy. 

The creation of the assignats was a fruitful source 
of changes advantageous to our social order. It 
favored the division ot the soil and restored to cultiva- 
tion a multitude of lands formerly consecrated to unpro- 
ductive uses. It multiplied the number of producers by 
procuring for them the first element of production, land, 
and the most effective stimulant to labor, property. In 
the reports of the principal members of our great deliber- 
ative assemblies, the serious men of our days will find 
ample subject for study upon these important matters. 
Mirabeau, Necker, Roederer, Dallarde, and Cambon have 
left us works to which posterity is beginning to render 
justice, and which deserve to figure among the interesting 
monuments of political economy. What more favorable 
to manufactures than patents for inventions and the fine 
discussions on this subject which took place in the Con- 
stituent Assembly ? Later, the National Convention se- 
cured literary property by a decree ; it consolidated unity 
of weights and measures throughout France by the 
adoption of the decimal system, and by gigantic creations 
which powerfully contributed to increase the fortune of 
the state, nobly repaired the injuries which circumstances 
forced it to inflict upon the fortunes of citizens. There 
was a brief period when it dared to decree industrial con- 
quests as well as military conquests ; the telegraph, chem- 
istry, physics, were at the order of its committees, as vic- 
tory at the orders of its generals. 



422 HISTORY OF POLITICAL ECONOMY. 

We cannot pass over in silence the formidable expedi- 
ents to which that assembly was obliged to have recourse 
in order to contend against the coalition of kings. The 
day of justice begins to dawn for it, and every one knows 
that in its view the inaximiini, the requisitions, the forced 
loans, were not regular resources, but measures of public 
safety demanded by the most unyielding necessity. In 
• the extreme peril in which the country was, it was neces- 
sary for it to provide for its needs in the most urgent 
haste, and nevertheless its most violent resolutions were 
always distinguished by a breadth of view rarely found 
even among the most enlightened governments in the 
calmest times. We must go back to the starting point 
of these grand measures, to justly appreciate their rigor- 
ous and inevitable consequences. Let one then picture 
to himself the Convention reduced simply to the property 
of the clergy and of emigrants, to face the whole of Eu- 
rope and civil war. In order to put into circulation the 
value of this property, it had devised the assignats which 
were the representation of it, and which, by means of 
purchases, were to return to the treasury and be burned ; 
but few people bought the property. In vain were as- 
signats multiplied in anticipation of demand ; the more of 
them were created, the more their value depreciated. It 
was necessary to interdict the employment of specie, and 
to commence again the edicts of the regent against gold 
and silver, as was seen at the end of Law's system. Every 
day prices rose with the issues of paper money. Then it 
was determined to establish a maximum ; but commodi- 
ties disappeared. 

It is easy to be indignant to-day, in the name of sci- 
ence, at the infractions the latter suffered in those agita- 
ted times. We still speak of them under the influence 
of the terror of our fathers' day ; but when we see, after 
the bankruptcy, Cambon open with so firm and tranquil 
a hand the great book of the public debt, and make the 
creditors of all periods pass under the same level, by at- 



DEBT FUNDED. PAUPERISM. TARIFF. 423 

taching their guaranty to the preservation of the new 
regime, we cannot help a feeling of admiration and re- 
spect. Interest was brought back to a single rate ; all 
the debts were converted into a perpetual loan not paya- 
ble unless the government should wish to purchase it 
when It was below par, which was virtually equivalent to 
an amortization. The science of public credit was born 
anew m the very assembly which seemed to have dug its 
grave. At the same time, the Convention attempted a 
great reform in pauperism by numerous decrees issued in 
favor of the indigent classes. It proclaimed education a 
national debt ; and if, since, this grand principle has not 
received an entire application, it remains as a monument 
o the official solicitude of France for the amelioration 
of the fate of all her children. One might say that the 
Convention worked for the human race, so vast was its 
horizon and so high and generous its thoughts. 

Among all the economic attempts made by our great 
assemblies, there is only one which has not been able to 
receive the sanction of an experiment, even for a very 
short time : that is, freedom of commerce. This alone 
remained unknown to the French, during the period 
when they tried them all. The Consrituent Assembly 
adopted a system of very moderate duties ; but it plainly 
mclined towards the restrictive system. The Convention 
made a weapon of warfare of the customs, directed princi- 
pally against England; and its prejudices, carefully kept 
up by the Empire, contributed not a little to the 
triumph of the narrow ideas which still prevail in France 
on commercial questions. This is a misfortune that we 
cannot too deeply deplore. It was so important to sci- 
ence that this great trial, opened several centuries ago 
should at least have been judged by one first court ' Far 
from being so, liberty has only broken down internal 
barriers ; it has freed labor from only a part of its fetters 
and those which remain are sufficient to so compli- 
cate all questions of political economy, as to render 



4-24 HISTORY OF POLITICAL ECONOMY. 

them almost impossible to resolve. Thus, in England, 
the poor-tax is one of the principal causes of the main- 
tenance of the corn-laws,"^ which are prohibitory ; and the 
increasing embarrassments of our commerce are the in- 
contestable result of the artificial life which tariffs have 
given our manufactures. Napoleon, who started them 
decidedly in that direction, by the establishment of the 
Continental Blockade, did not conceal its serious conse- 
quences: " It has cost us dear," he said, " to return, after 
so many years of civilization, to the principles which char- 
acterize the barbarism of the earlier ages of nations ; but 
we have been constrained to oppose the common enemy 
with the same weapons which he used against us." f 

The Continental Blockade may be considered as the last 
expression of the economic system adopted by France 
at the beginning of the Revolution. Although Napo- 
leon only intended a legislative act of reprisal against the 
British Government, the Berlin Decree became the basis 
of the industrial and commercial system of France and of 
continental Europe during the whole of the Empire. 
This decree, which laid England under an interdict, 
caused the barriers to fall which separated the other 
nations. It established a sort of confederation between 
them against the common enemy, and it opened the en- 
tire continent, while shutting up one island. For the 
first time, liberty seemed to be born again from excess 
of prohibition. The various European states, subject by 
conquest or by treaties, to the same commercial laws, 
formed now only one single producing people , and never 
did the development of their manufactures take a wider 
extension than under the influence of that competition 
which animated them all. These were the finest days 
of French industries, and yet France then possessed 
Belgium, Italy, and Rhenish Prussia, whose manufac- 

* These laws were repealed in 1846, as a result of the efforts of the Anti- 
Corn-Law League. 

f Message of Napoleon to the senate on sending it the Berlin Decree, 
November 21, 1806. 



RESULTS OF CONTINENTAL BLOCKADE. 425 

tures of cloths, silks and linens, rivals of ours, far from 
injuring the prosperity of the latter, enhanced their repu- 
tation and their value. The continental blockade would 
have opened the era of free trade in Europe, if the lat- 
ter could have originated from a feeling of hostility and 
of reprisals, like that which had inspired the emperor. 

But the definitive result of this system was to accustom 
European industries to live by protection and tariffs. 
All our manufactures, encouraged by the exclusion of 
the products whose competition could be most danger- 
ous, and by the sure markets which all Europe, almost 
wholly subject to our arms, offered us, became im- 
mensely extended. The iron and coal of Belgium, the 
linens of Holland, the silks of Italy, and the wools from 
Germany, being admitted into our markets the same as 
French goods, did not at that time hinder the develop- 
ment of our national manufactures ; how then could there 
have been necessary, in order to maintain them, after the 
peace of 181 5, tariffs that were daily increasing and di- 
rected against these same people whose competition had 
caused no injury to France during their union to her ter- 
ritory? Each of them has, since, shut itself up in a triple 
cordon of custom-houses, and we have seen the fiercest 
industrial war succeed the political wars, as if general 
peace was a chimera, a utopia incapable of ever being re- 
alized. In vain had the Revolution emancipated labor by 
the suppression of wardenships and masterships; by al- 
lowing the prohibitory system to remain, it maintained a 
virtual commercial feudalism, which secured to certain 
classes of producers benefits obtained at the expense of 
the community ; it gave birth to the intestine wars with la- 
bor, in which so many laborers have succumbed as victims 
to laws which seem made for their protection. The great 
error of this system consists in having treated foreign pro- 
ducers, that is, the creators of exchangeable products, as 
adversaries rather than as customers. Old political 
grudges have been employed for keeping up the prej- 



426 HISTORY OF POLITICAL ECONOMY. 

udices of manufacturers, by placing under the auspices 
of patriotism the interested calculations of privilege and 
of monopolies. The Convention and the Empire used 
protection as a weapon of warfare ; our civilization con- 
tinues to employ it after twenty-five years of peace. 

We must not then seek in the great works of the French 
Revolution for the germs of the economic reform whose 
dawn seems to be appearing among us. All that the 
French Revolution did to this end, it did in an indirect 
manner : it embodied it in its codes, and for that rea- 
son they have ceased, in many respects, to be in har- 
mony with our needs. The suppression of the law of pri- 
mogeniture, the nearly absolute equality of inheritances in 
a direct line, the legislation for commercial companies, the 
unity of weights and measures, are incontestable benefits ; 
but equality before the law ceases to be a truth, when we 
see laborers of every sort, who are already dependent on 
capital for wages, become so also for consumption. In 
the present state of legislation, no guaranty protects la- 
bor in its relations to the wealth which commands it and 
which pays it ; no guaranty secures to the one who is 
paid the free disposal of his wages. The price of labor 
tends constantly to diminish and that of articles of con- 
sumption to increase, because both are in reality fixed by 
one alone of the contracting parties. The French Revolu- 
tion found itself, like us, confronted with this formidable 
problem, of which it determined to force the solution by 
penalties ; but penalties were as powerless as laws to ac- 
complish that end. The maximum produced famine ; the 
arbitrary determining of wages suppressed labor. Bounties 
to the poor created mendicancy ; the exclusion of foreign 
products opened the way to monopolies. 

The bold attempts of that period are not without re- 
semblance to those Turgot had made, under the monarchy, 
in the interest of the laboring classes. The only thing 
which distinguishes them is that the reformers of the 
Convention, more powerful than the minister of Louis 



MAXIMUM. MARAT. SAINT-JUST. BABEUF. 427 

XVI, took no account of the facts and opposing forces 
before which Turgot had been obliged to recoil. One 
would say that in their view the human race was inert 
matter capable of enduring all experiences, so many sys- 
tems did they propose that were absurd, anarchical, and 
destructive to all society. Marat, Saint-Just, and Babeuf 
have left us curious memorials of that monomania which 
disturbed minds eager for novelties and disposed to put 
in practice the most extravagant social dreams, as one 
tries chemical processes and combinations in a laboratory. 
Soon there was but one single phrase in the economic 
vocabulary of French language : this was the celebrated 
saying of Danton : " Audacity, more audacity, and au- 
dacity always ! " When the Paris Commune came to 
solicit the National Convention to establish a maximmn, 
its president said : " This concerns the indigent class, for 
which the legislator has done nothing, when he has not 
done everything. Let no one bring up in opposition the 
rights of property : the right to property cannot be the 
right to starve one's fellow-citizens. The fruits of the 
earth, like the air, belong to all men." * Marat had gone 
much further, and we could quote similar extravagances 
from that energumen, if posterity, who have begun to 
take note of him, had not already classed him with 
madmen. 

Saint-Just was the boldest and most lofty expression of 
that school of tribunes, revived from the Gracchi, in com- 
parison with which those illustrious factionists were mod- 
erate men. The writings he left contain his economic 
views entire, energetically summed up by the orator of 
the Paris Commune, and clearly formulated in the decrees 
issued by the National Convention during the rule of the 
Mountain Party. It was reserved for Babeuf to go be- 
yond these doctrines and to preach openly the agrarian 
law, the abolition of property and the permanent rebeU 
lion of the poor against the rich. But these rash 

* Parliamentary History of the Revolution, vol. xxvi, p. 52. 



428 HISTORY OF POLITICAL ECONOMY. ■ 

speeches had no other result than to alienate for a long 
time the best minds from all social speculations, so much 
did they dread to see themselves confounded with the 
mad demagogues of the anarchical school. A serious 
lesson, too, came from all the hazardous attempts of the 
French Revolution : namely, that habits are not so easily 
reformed as institutions, and that the finest laws are not 
sufificient to secure to each citizen a prosperous condition, 
if he does not cooperate with them by his labor and his 
morality. Those seductive dreams have henceforth van- 
ished. All the wealth and felicity which the philan- 
thropy of legislators could decree was decreed ; and 
people learned that public wealth followed other laws 
than those of force and tyranny. Had only this step 
been taken, it was an immense advance, for it forced 
governments and individuals to seek the elements of 
future greatness elsewhere than in legislative programmes. 
What then remains of all those brilliant and generous 
dreams which have agitated the world from Turgot down 
to our time, and what social conquests has political econ- 
omy made, which have in the end redounded to its glory ? 
We can mention two memorable ones, the emancipation 
of the English and the Spanish colonies of America, and 
the abolition of negro slavery ; to which should perhaps 
be added the suppression of corporation privileges, that 
is to say, the affranchisement of labor. We have still 
two other victories to gain : the affranchisement of the 
workers and that of commerce, a difficult and complicated 
task in times like ours, when governments themselves 
share the common prejudices against commercial freedom 
and consider it hostile to national labor. Of all the 
economic errors of the revolution, that alone has sur- 
vived, more deeply-rooted than ever, and it has risen tri- 
umphant over the ruins of the others. People no longer 
defend slavery, corporations, or privileged companies ; 
national hatreds have nearly disappeared to give place to 
industrial rivalries and jealousies. The battle-field is no 



INDUSTRIAL CONTESTS. ASSOCIATION. 429 

longer on the plains, it is in the workshops. There 
the war is going on, intelligent, unrelenting, indefati- 
gable ; and it takes victims from all parties occupied with 
injuring each other instead of rendering mutual aid ; a 
veritable war, in which the combatants make use of in- 
genious and powerful machines, which, pitying neither 
infancy nor old age, leave on the ground of poverty mil- 
lions of panting laborers, men and women. 

This war is to-day the last expression of the old politi- 
cal economy of Europe, and the last reverberation of the 
great social contest raised by the French Revolution. It 
is not merely an international struggle ; it is a serious 
contest between the various classes of workers. France 
has doubtless the appearance of competing with England ; 
but capital is carrying on a much deeper struggle with 
the workman. Under pretext of making the country 
triumph in the first of these combats, an organization is 
maintained in regard to labor, which has ceased to be in 
harmony with its needs and the progress of civilization. 
So there is nothing new in the science from 1789 to 18 14, 
except the experience of actual facts and a facility in de- 
ducing conclusions from them in order to go forward and 
complete the work of our fathers. However, there will 
soon come forth from the midst of industrial labor, an 
irresistible power, destined to cure, like the spear of 
Achilles, the wounds it makes : a power born of our 
commercial discords, and which will end by extinguishing 
them all : it is association, imported from England, where 
the excessive taxes made necessary by the war, furnished 
it the means of supplying that need by force of prodi- 
gies : but it is well to trace this new element of social 
progress to its principal causes, and to study the facts 
which prepared the way for it. 



CHAPTER XXXVIII. 

The economic revolution effected in England by the discoveries of Watt 
and Arkwright. — Economic results of the independence of the United 
States. — Reaction from the French Revolution on the financial system of 
England. — Increase of taxes. — Suspension of payments by the bank. — 
Development and abuses of credit. — Enormity of the public debt. — Con- 
sequences of the general peace. 

While the -French Revolution was making its great 
social experiments over a volcano, England was begin- 
ning hers on the solid ground of the industries. The 
end of the eighteenth century was distinguished there by 
wonderful discoveries, destined to change the face of 
the world and to increase in an unexpected manner the 
power of their inventors. The conditions of labor under- 
went the greatest modification they have experienced 
since the origin of society. Two machines, henceforth 
immortal, the steam-engine and the spinning-machine, 
overturned the old commercial system and gave birth 
almost simultaneously to material products and social 
questions unknown to our fathers. The small workers 
were about to become tributary to the great capitalists ; 
the spinning-frame replaced the wheel, and the steam-cyl- 
inder succeeded the horse-power. At the same time, the 
fine attempts of the Duke of Bridgewater at canalization 
were beginning to produce results, and the perfecting of 
transportation coincided with the increase of merchandise. 
The production of iron and that of the other metals im- 
proved with that of coal, to which activity had been given 
by the employment of steam in the work of drainage. 
One would have thought that England had discovered 

430 



ECONOMIC RESULTS OF MACHINES. 43 1 

new mines and had suddenly become enriched by unex- 
pected treasures. 

The contemporary generation, more occupied with 
reaping the advantages of these conquests than with 
investigating their causes, appear not to have estimated 
at their just value the embarrassments which ensued from 
them. That transformation from patriarchal labor into 
industrial feudalism, in which the workman, the new serf 
of the workshop, seems bound to the glebe of wages, did 
not alarm the English producers, although it had a charac- 
ter of suddenness quite adapted to disturb their habits. 
They were far from foreseeing that machines would bring 
them so much power and so many anxious cares. Pau- 
perism had not yet appeared among them under the 
threatening forms it has since assumed, and the mechani- 
cal trades had not developed that power of labor which 
was to be for a time so fatal to many workers. How- 
ever, hardly was the industrial revolution born from the 
brain of those two men of genius, Watt and Arkwright, 
when it took possession of England. At the end of the 
eighteenth century, there was not a single piece of cloth 
consumed in Europe which did not come to us from 
India, and twenty-five years after, England sent cloth to 
that very country, from which she had hitherto ob- 
tained all like products. "The river," says J. B. Say, 
" had gone back to its source." * Thus, two little cyl- 
inders turning opposite ways, had sufficed to wholly 

* Before the invention of spinning-machines, there was estimated to be 
in Great Britain only five thousand spinners at spinning wheels, and tliree 
thousand weavers of cotton goods, in all about eight thousand workers ; 
while to-day this number amounts, in England alone, to more than eight 
hundred thousand. The total value of cotton cloths, in that country, was 
estimated, in 1836, at the enormous sum of eight hundred and fifty millions 
of francs. One can consult in reference to it the statistics of Mr. 
Mc Culloch and Mr. Porter, and the documents published by order of 
parliament. (Note of author.) 

In 1876, the total value of the cotton manufactures of Great Britain (see 
Ency. Brit.) was estimated at £89,856,000 ; the number of spindles, (inclu- 
ding doubling) 41,881,789, number of persons employed 479,515 ; estimated 
capital invested £90,000,000 ; number of yards of cotton goods exported, 
3,668,582,100; number of persons directly or indirectly dependent on the 
cotton trade probably not far from 2,000,000. — Trans. 



432 HISTORY OF POLITICAL ECONOMY. 

change the relations of Europe with Asia, and the vener- 
able traditions of labor. At the same time, the indepen- 
dence of the United States carried with it a decisive 
blow to the colonial system, and gave the signal of re- 
treat to all domination of parent countries. The city 
of Bristol, which had addressed to parliament such spirit- 
ed petitions against peace with the rebellious Ameri- 
cans, besought, a few years after the signing of the treaty 
of peace, authority to dig new harbors made necessary 
by the extension of commerce with the emancipated 
colonies. Thus was prepared a general independence 
of the new continent whose last * colony subject to 
European laws is now struggling to complete the work 
of Franklin and Washington. It was then proven that 
colonies were more injurious than useful to their parent 
countries, and that there were greater profits to be made 
from a free and industrious people, than from enslaved 
and oppressed vassals. The United States have given 
Europe this lesson in political economy, which will make 
the circuit of the world and will avenge the descendants 
of the colonists for the state of oppression in which their 
fathers lived. The prophecies of Raynal have become 
fulfilled. Rich and powerful nations have succeeded the 
weak and precarious settlements of the Europeans in 
one of the two Indies, and one would say, to see the state 
of torpor of some old parent countries, that the purest 
of their blood had passed forever into the veins of their 
colonies. 

This is, indeed — however the pride of the old continent 
may suffer from it, — an immense revolution, the conse- 
quences of which we are beginning to experience. We 
are tributary to our former vassals for a great number of 
raw materials and special products, without which the 
work of our manufactures would cease to exist. America 
sends us the heaps of cotton by which our innumerable 
manufactures of cloth are supplied, and the dye woods 
* Canada (written in 1836). 



COMMERCIAL INTERDEPENDENCE. 433 

which are used in printing them. Coffee, cocoa, Peruvian 
bark, which cures fever, the drugs which give it, all 
come from abroad. Our wants make us daily more de- 
pendent on people beyond the sea. The city of Lyons 
trembles to its foundations at the shocks which agitate 
New-York or Philadelphia. A failure at New-Orleans 
may ruin ten merchants at Liverpool. The extraordinary 
development which the invention of machines has given 
to production, demands continually increasing markets, 
which must be sought at a distance and competed for by 
a lowering of prices among the most advanced nations. 
Markets have become battle-fields. Diplomacy no longer 
bargains for provinces, but for tariffs ; and armies, when 
they move, are like bands of messengers going to make 
way for commerce. This is what has been produced by 
the emancipation of the New World, to which our great 
European manufactures will soon be no more than colo- 
nies. 

No age has seen such economic revolutions accom- 
plished in so little time, and it is not surprising that such 
unusual changes should have disconcerted all systems. 
That sudden prosperity of the United States was such a 
solemn contradiction to all the old school of Charles 
V ! What became, in the face of that great event, of 
the theories about balance of trade, and the administra- 
tive habits of the colonial regime? So many odious wars 
and so many maxims still more odious, had then been 
kept up, only to be reduced at last to a most humiliating 
recantation. Those laws for the protection of commerce 
were then only a dreadful abuse of power ! Never, it 
must be confessed, had human vanity received a more 
cruel blow, and yet, in spite of this striking lesson, the 
pretensions of parent countries have scarcely moderated. 
They must all drink the chalice of bitterness before they 
will relinquish their despotic habits ; being in this re- 
spect, like monarchies by divine right, which believe that 
all rights rest on one sword, until the very moment when 
that sword breaks in their hands. 



434 HISTORY OF POLITICAL ECONOMY. 

The American Revolution was not the only decisive 
economic fact of the latter part of the eighteenth cen- 
tury. We have seen that the discovery of the two 
machines of Watt and Arkwright had completely changed 
the conditions of labor, by substituting machinery for 
the arms of men, and great associations for petty indus- 
tries. This single fact was to give a death blow to all 
corporations, and reduce to dust their old and barbarous 
codes ; but it could not fail to react at the same time 
on the financial system of Europe. The natural end of 
taxes being to reach incomes wherever they may be, one 
readily divines that the science of finance hastened to 
work the new field which offered its harvests. The ex- 
treme increase of industrial products called the attention 
of legislators and statesmen to this young branch of 
public wealth, and, consequently, in England the in- 
crease of indirect taxes went side by side with the de- 
velopment of manufactured products. Efforts to dim- 
inish the burdens of the people suddenly ceased ; it 
appeared more advantageous to give the latter strength 
to bear them. " Since it is not possible to diminish the 
burden, let us strengtheit the beast,'' said an English min- 
ister, and this saying well characterizes the financial tactics 
of modern governments. Nations as well as individuals 
have ceased to shut themselves up in the narrow circle of 
privations ; they have more wants because they have more 
means of gratifying them : they only need to increase the 
quantity of labor. 

England had reached that point in her economic ex- 
perience, when it was necessary for her to suffer her part 
in the reaction from the ideas disseminated by the French 
Revolution. A singular contrast, indeed, was that of two 
nations, one of which was rushing into indirect taxes, 
while they were being abolished by the other ! And 
these opposite courses are easily explained. The aris- 
tocracy, all powerful in England, found it a simple matter 
to throw upon labor all the weight of the imposts ; the 



EFFECT ON TAXATION. 435 

democracy, victorious in France, committed the same in. 
justice towards property. Here, the property of emi- 
grants was sold, and landed property was tithed ; there, 
the smallest articles for consumption were taxed, even 
to the air necessary for the lungs. It is not surprising 
that an implacable war broke out between the two prin- 
ciples so opposed ; and this war only ceased to prevail 
when political economy effected a compromise, founded 
on a true analysis of the elements of wealth. When 
Adam Smith had demonstrated that manufacturers and 
traders were producers by the same right as cultivators 
were, the necessity had to be recognized of taxing manu- 
facturing and commercial products as well as agricultural 
products, and each of them proportionately to its in- 
come. What remains to-day to be decided, is, at what 
point equity and analysis permit taxation of the classes 
who live by their wages and not by profits ; and this is 
why the question, first propounded between the aris- 
tocracy and the bourgeoisie, has come down into the 
arena of popular passions. 

The long wars of the revolution, between France and 
England, by laying the two countries under the necessity 
of extreme measures and hazardous attempts, contributed 
no less than the Economist writers to the solution of 
several important problems. We are far from admitting, 
with Ricardo, for example, that the increase of taxes was 
the principal cause''" of the development of manufactured 
products in England. No one works simply to pay 
taxes, and there is no production possible on that con- 
dition ; but it cannot be denied that a desire to procure 
many indispensable objects of consumption, which are 
taxed, will incite, in most men, a very strong disposition 
to labor. Unfortunately, the English government, in- 
duced by the exigencies of war, took unfair advantage 
of this disposition, which soon became insufficient, and 
the mania for expedients seemed to revive in the latter 
part of the century, as it had prevailed at its commence- 



436 HISTORY OF POLITICAL ECONOMY. 

ment. The most extravagant theories of finance were pro- 
claimed as positive maxims of the government. The im- 
posts ceased to respond to the distress of the treasury: it 
was necessary to have recourse to loans, to multiply them, 
to combine them in a thousand ingenious ways, in order to 
make good the constantly increasing deficits ; and hence 
arose the theory of amortization^^ that chimera of which 
England was to be, within a few years, the cradle and the 
tomb.* 

The English have nevertheless had the honor of found- 
ing modern public credit in Europe, by proving that it 
could very well survive the most critical circumstances, 
and even aid a great people to emerge from them with 
honor. Indeed, notwithstanding the perpetual growth 
of taxes and loans, the population of England had not 
ceased to increase, its agriculture to become enriched, and 
its manufactures to daily become more productive. New 
canals had been opened, docks hollowed out, colossal 
enterprises executed with admirable rapidity ; the national 
capital had increased with production itself: so that to- 
day the English nation is perhaps that which disposes of, 
the largest revenue, although it pays enormous taxes. 
That which was to lead it to bankruptcy led it to for- 
tune, and its very bankruptcy,(for, like France, it passed 
through that trial,)vvas to it another opportunity for pro- 
gress and a source of improvements. We might say that 
to it was given to overthrow the received systems, in 
everything, and to astonish the world by its operations 
in finance, as much as by the processes of its manufac- 
tures. Pitt ventured to maintain that the fictitious capi- 
tal created by the loans had been transformed into fixed 
capital, and had become as advantageous to the public 

* M. V€ax&x{^Histoire Jinmicih-e de r empire Britannique), estimates at nearly 
fifty milliards of francs the sum of the revenues collected and loans con- 
sumed by the English government, from the beginning of the French Revo- 
lution to the treaty of 181 5. This is a sum five times greater than the 
whole mass of money existing in Europe at that time, during which the 
precious metals were the most abundant. Fr. Ed. 



FLOATING DEBT. BANK-SUSPENSION. 437 

as if an equivalent real treasure had been added to the 
wealth of the kingdom. What more absurd than such 
an assertion, and what more surprising, too, than the 
marvellously fecund results of those multiplied loans, 
under the weight of which England was expected to 
succumb ! 

Thus it was that the English, not satisfied with their 
funded debt, invented the floating debt, by means of those 
enormous issues of treasury notes, the employment of 
which, wisely regulated in times of peace, has become 
one of the most convenient and safe resources of modern 
states. Administrators have made economists compre- 
hend that there was often much economy in being able 
to employ by anticipation in January the revenue of 
December ; and the boldness of an attempt justified by 
the critical condition in which England found herself, has 
permitted a useful financial institution to be substituted 
for the onerous expedients of past times. The flioating 
debt has become the refuge of all inactive capital and 
the reserve of constitutional governments. It is no longer 
necessary to hoard capital beforehand to the deprivation of 
labor, in order to provide for unforeseen wants. Who could 
have persuaded the school of the Physiocrates, or even that 
of Adam Smith, of such things, before the truly gigantic 
experiments of Great Britain had permitted a belief in 
them and a recognition of their strong and their weak 
points ! 

The same astonishment struck the economic world at 
the news of the suspension of payments by the Bank of 
England in 1797. Surely, if any doctrine was ever judi- 
cious and sound, it was that of Adam Smith on the con- 
stitution of banks, and the necessity of their limiting 
their issues of bills, under penalty of being obliged to 
purchase specie at great expense after having seen their 
notes depreciate : one day, however, the Bank of Eng- 
land," exhausted by discounting treasury notes, found 
itself forced to suspend specie payments. It was a vir- 



438 HISTORY OF POLITICAL ECONOMY. 

tual bankruptcy, since the notes were payable to the 
bearer in gold ; and such a bankruptcy under the circum- 
stances then existing in England, seemed as if it must 
bring about the most fearful catastrophes. It did not so 
eventuate, however, because the government had the 
good sense to stop on that declivity, and not to multiply 
beyond measure the bank-bills, which had become paper- 
money. The slight difference between the rate of gold 
and that of paper was scarcely perceptible, and the ex- 
port of specie seemed to have no other result than to 
make monetary wealth more productive. When, later, 
the issues exceeded the limits within which the mak- 
ing of paper-money had been restricted, there only re- 
sulted a general rise of wages and prices. The nation 
seemed to have become richer, because the nominal 
amount of wages was higher, and this increase produced 
a general feverish condition of national labor. 

On the other hand, while these curious phenomena 
were manifest in England, contrary experiments were 
having a distressing termination in France. The assignats 
and the ma7tdats, although secured by national property, 
suffered a depreciation unheard of in financial history 
since the failure of Law's system. They fell to the last 
degree of demonetization, while the bank of England 
notes maintained their value in spite of the bankruptcy. 
The former, exchangeable for land, were no longer worth 
anything ; the others, deprived of specie security, pre- 
served their nominal value. France, with all the elements 
of prosperity, was plunged in anarchy; England, with all 
the elements of anarchy, was prosperous. Production 
seemed to double in the latter country in proportion as 
specie was withdrawn from it : it was paralyzed in France, 
notwithstanding the sale of the property which created 
millions of landholders and consequently the most ener- 
getic stimulus of production, as we have said, viz., land- 
ownership. No period has ever been more fertile in 
grave economic instruction, unless we except that which 



RETURN TO SPECIE PAYMENTS. PEACE. 439 

followed the return" to specie payments, when the peace 
of 1 8 1 5 permitted England to resume them, in pursuance of 
the famous act of Mr. Peel. The consequences of that re- 
sumption came near being more disastrous to Great Britain 
than suspension had been, or rather, than it had seemed that 
it must be. The English people had become accustomed 
to the small bank notes, and had adopted them for money. 
The landowners, the government employes, the fund-hold- 
ers, those of every rank who received pay, had cradled them- 
selves in the illusion of an increase in their fortune, because 
they received higher farm-rents, emoluments or incomes. 
Suddenly the arrival of specie, flooding the national 
market, found numerous transactions made under the 
rule of paper-money and high prices. Many a man who 
had made a bargain under those conditions, was obliged 
to pay in specie. One can readily divine what a disturb- 
ance must have accompanied that financial revolution, 
which particularly affected agricultural leases, and which 
resembled, in an opposite way, the final crisis of our 
paper-money. It was necessary to prevent the ruin of 
farmers by heroic remedies, and workmen living on salaries 
or wages were condemned, by the corn-laws, to pay the 
debt of the agriculturists to the land-proprietors. 

This crisis was not the only one which affected the Brit- 
ish people, and Europe was going to be witness of more 
than one revolution, when the treaty was signed, which 
seemed as if it would conclude them all. We have seen 
that the continental blockade gave an extraordinary im- 
pulse to French manufacture, henceforth almost alone 
invested with the markets of the continent. England, 
under the influence of this same blockade, had taken pos- 
session of the seas and of all the colonial markets, which 
secured to her her maritime preponderance. The result 
to her had been also a great activity in manufactures, to 
which besides smuggling lent its support. Suddenly 
peace breaks out, as a complete and sudden war might 
have done ; and the treaties which restore repose to the 



440 HISTORY OF POLITICAL ECONOMY. 

world prepare new struggles for commerce, a thousand 
times more serious and more inextricable than the strug- 
gle of arms. France, reduced to her former limits, is 
surrounded by a triple cordon of custom-houses, almost 
to the gates of her capital, and England, which furnished 
supplies to the colonies, is forced to yield their markets 
to their mother-countries, now at peace with her. Spain 
attempts to take back South America; the Dutch regain 
Java; each desires to recover possession of her prey ; and 
the bayonet-war changes into an ignoble war of fathom- 
lines and of custom-ofificers. The conditions of labor 
were then once more modified throughout all Europe by 
the overthrow of French domination and by the opening 
of the seas, so long English, to the trade of all nations. 

European administration presented at that time a spec- 
tacle well adapted to arouse people to the study of politi- 
cal economy. States which but a short time before were 
prosperous notwithstanding the rivalry of neighbors sub- 
ject to them, solicited against these very neighbors, which 
had become free, restrictions each day more severe, and 
closed their boundaries against themselves by interdict- 
ing to them theirs. England seemed more repelled from 
the continent by the tariffs of her allies than she had been 
by the arms of her enemies, and poverty invaded her 
deserted workshops, while her victorious policy was seem- 
ing to secure for her the monopoly of the world. All 
that remained to her from so many efforts was the alarm- 
ing figure of her public debt and of the population enfee- 
bled by the taxes which an inexorable aristocracy had 
imposed upon them. What a magnificent subject of 
study for economists ! How many facts were presented 
for their observation by that long series of events new in 
the history of the science, the division of property, the 
abolition of wardenships, indirect taxes, public loans, 
amortization, paper money, the suspension and resump- 
tion of payments by the bank of England, and above all, 
that astonishing contrast of opposite results from simi- 



POLITICAL ECONOMY BECOMES A SCIENCE. 441 

lar causes, and like results from opposite causes ! From 
that time, people comprehended that there was nothing 
absolute in social physiology; it passed naturally into 
the rank of experimental sciences, and its judgments 
were to be founded on experience and the comparison 
of actual facts rather than upon original theories. I do 
not hesitate to affirm that it is from that vast encyclo- 
paedia, which dates from 1789 and ends in 1830, that 
political economy has drawn its most valuable materials 
and the most solid bases of its doctrines. Economists, 
from that time, approach positive questions and mingle 
seriously in human things ; they depart from the arid 
ground of abstractions to rise to practice, that is to say, 
to become useful and truly popular ; a signal honor, and 
one which belongs especially to one of our fellow coun- 
trymen, J. B. Say. 



CHAPTER XXXIX. 

J. B, Say and his doctrines, — Important consequences of his theory of 
openings for marketable produce. — The services that writer has rendered to 
science. — Character of his school. — It has popularized political economy in 
Europe, 

It could not be otherwise than that the great experi- 
ments made in France and England, during the long 
struggle these nations maintained against each other, 
should furnish political economy with new elements of 
observation and contribute to its advancement. Adam 
Smith had unquestionably laid the essential bases of that 
science with a firm and positive hand ; but we have seen 
that he had left to his successors deep questions to resolve. 
What principally remained to be done, was to fix the 
limits of the science and to properly determine the field 
which its researches should cover. Adam Smith had 
thrown much light on the theory of banks, division of 
labor, and the foundation of the value of things ; he had 
made virtual discoveries : but he had not lived long 
enough to observe their applications. It was only after 
his death that people could judge of the effects of un- 
limited competition, of which he was one of the first 
apostles : and the complicated pauperism of our days had 
not yet disturbed the serenity of those in which he lived. 
Political economy was only the science of the production 
of wealth. It was reserved for a Frenchman to complete 
the work and to initiate us into the mysteries of the dis- 
'iribution of the profits of labor, at the same time that he 

443 



ECONOMY SEPARATED FROM POLITICS. 443 

made known to us the so varied phenomena of the con- 
sumption of products. 

The situation of France was very favorable for that 
study, after the storms of our revolution. Had not the 
people tried all systems and carried to their last results 
the most hazardous principles? Had they not had a 
near view of bankruptcy, the wasting of capital by war, 
the momentary destruction of commerce by the ntaxiniuni, 
the blockade of the seas and that crowd of industrial and 
financial catastrophes with which the history of the time 
is wholly filled ? The time had come to draw conclusions, 
and to sum up in one body of doctrine the theories which 
naturally arose from that mass of new and unheard-of 
facts. It was necessary to explain this economic cataclysm 
unparalleled in the world, which appeared neverthe- 
less as the precursor of a general renovation. This is 
what J. B. Say did, in publishing, under the consulate 
of Bonaparte, the first edition of his Treatise on Political 
Economy. From this book dates, in fact, in Europe, the 
creation of a simple, strict and intelligent method of study- 
ing political economy, and the time has come for us to 
judge of it. 

The principal merit of this work consisted in having 
clearly defined the bases of the science. J. B. Say sepa- 
rated it from politics, with which the Economists of the 
eighteenth century had constantly confounded it, and ad- 
ministration, which the Germans thought inseparable from 
it. Thus reduced to more precise limits, political economy 
ran no further risk of being lost in the abstractions of 
metaphysics and the details of bureaucracy. J. B. Say 
rendered it independent by isolating it ; and he proved 
that its study was as suitable for monarchies as for repub- 
lics. Everywhere there was need of knowing its laws, 
because, under all forms of government, the production 
of wealth was the most prolific source of the prosperity 
of states. At the same time, he explained its principles 
in the clearest and most methodical manner, and he ere- 



444 HISTORY OF POLITICAL ECONOMY. 

ated the nomenclature henceforth adopted by all the 
economists of Europe. His theory of value founded on 
utility completed that of Adam Smith, and although it 
left, like all theories, some gaps to be filled, it neverthe- 
less served to resolve the most difificult questions, with 
all the certainty of which they are susceptible. 

Whatever controversies may have arisen since then 
on several points in his doctrines, every one to-day re- 
cognizes the superiority of his method over all those of 
his contemporaries. Political economy is, in his view, 
only a science which treats of the production, distribution, 
and consumption of wealth. Wealth is produced by 
means of three great branches which sum up all human 
labor, viz., agriculture, manufactures, and commerce. 
Capital and land are the principal instruments of produc- 
tion : by saving and accumulation, people obtain the 
former ; ownership guarantees the free action of the 
latter. The labor of man, combined with that of nature 
and of machines, give life to all that combination of re- 
sources from which the riches emanate which are the 
common fund of associations. Smith had admirably 
demonstrated the advantages of division of labor; J. B. 
Say perfected his work and showed some of the abuses 
of that division, which were later overstated by M. de 
Sismondi.* 

But what assures immortal renown to the French 
writer is his theorie des debouches, (literally, theory of out- 
lets, i.e., openings for sale of products ; generally trans- 
lated, theory of markets.- — 7>'.3:7ZJ'.),which gave the last blow 
to the exclusive system and hastened the fall of the colo- 
nial regime. This fine theory, wholly founded on most 
careful observation of facts, has proved that nations pay 
for products only with products, and that all the laws 
v/hich forbid them to buy, prevent them from selling. 
No misfortune in the world is henceforth without its 
counterstroke ; when the harvest fails at one point, manu- 

* Nouveaux Principes d ' Economie Politique. 



SOLIDARITY OF NATIONS. 445 

factures suffer at another; and when prosperity reigns in 
a country, all its neighbors share in it, either because of 
the demands which come from it, or because of the good 
market which results from an abundance of products. 
Nations are then conjoined in good as in evil fortune : 
wars are follies which ruin even the conquerer, and the 
general interest of men is to render mutual aid, instead 
of injuring each other as a blind policy has too long im- 
pelled them to do. We are beginning to comprehend 
the consequences of this truly rational and elevated doc- 
trine, and one can readily judge from the solicitude of 
governments to avoid war, that the principles of J. B. 
Say have penetrated the councils of kings. His most 
glorious title to honor is to have demonstrated as a posi- 
tive truth and one of material interest, what appeared 
only a philosophic utopia ; and this merit is so much the 
greater because Montesquieu, Voltaire,* and La Fontaine, 
our finest geniuses, professed the contrary error. 

The restrictive system could iio longer be maintained 
before the overpowering arguments by which J. B. Say 
provoked its destruction. " People buy more," he said, 
'' whenever they receive more. One prosperous branch 
of commerce furnishes means with which to buy, and 
consequently procures sales for all other branches of 
commerce ; and, on the contrary, when one branch of 
manufactures and certain kinds of commerce languish, 
most of the others suffer in consequence. A nation, in 
its relation to another nation, is in the same condition as 
a province in its relation to another province, or a city in 
its relation to the country ; it is interested in seeing them 
prosper, and sure of profiting by their opulence.f The 

* We read in the Dictionnah-e Philosophique, article Patrie : " Such is 
the condition of human beings, that to wish the greatness of one's country, 
is to wish evil to its neighbors. It is clear that one cotmtry cannot gain tm- 
less another loses." 

Happily, that is not so clear to-day. 

fit would be as absurd to attempt to impoverish a people with whom 
we trade, as it would be in a tradesman to wish for the insolvency of a rich 
and frequent customer." — Buckle, Hist, of Civ., vol. i, p. 157. — Trans. 



446 HISTORY OF POLITICAL ECONOMY. 

United States have then acted in accordance with reason^ 
in seeking to give industrial arts to the savage tribes by 
which they are surrounded ; they wish them to have 
something to give in exchange, for one gains nothing in 
dealing with people who have nothing to give." How 
many experiments were we not obliged to make before 
arriving at these generous conclusions ! J. B. Say also 
wrote towards the end of his career: " Forty years 
have elapsed while I have been studying political econo- 
my, and what years ! They are worth four centuries for 
the reflections to which they have given birth." 

This writer had the inestimable advantage over all his 
predecessors and most of his contemporaries, of having 
followed the march of events as a judicious observer and 
having profited by the numerous experiences which these 
events offered. Besides, he did not confine himself to 
the study of the phenomena of wealth in a purely theo- 
retical and abstract manner : we recognize at every step 
the practical man, accustomed to follow out the conse- 
quences of his doctrines and to subordinate the latter to 
the greater or less utility of their applications. The 
distinctive characteristic of his writings, perspicuity, is 
especially manifest on the questions which had been ob- 
scured by economists of all times and countries, and 
chiefly in that of moneys. He explains their elements 
with admirable clearness, and he reduces to nothing that 
innumerable mass of writings which sprang up in Italy, 
Spain, France, and England, at the period when the 
governments were, in turn, playing the part of making 
debased coin. If he speaks of the various classes of 
workers who cooperate in production, we feel that he has 
lived with them, and that he knows their needs and has 
an exact idea of their troubles. It is to him that savants 

" The feelings of rival traflesmen, prevailing among nations, overruled for 
centuries all sense of the general community of advantage which commer- 
cial countries derive from the prosperity of one another ; and that commer- 
cial spirit, which is now one of the strongest obstacles to wars, was, during 
a certain period of European history, their principal cause." — y. S. Mill, 
Polit. Econ., 1849, vol. ii. p. 221. — Trans. 



SAY'S VIEW OF IMMATERIAL PRODUCTS. 447 

owe their restitution to the industrial hierarchy ; and 
ahhough immaterial products are not susceptible of accu- 
mulation, J. B. Say has demonstrated their salutary in- 
fluence on the prosperity of states. Public functionaries 
alone and the services they render to society, have found 
less favor with this illustrious economist : the indignation 
he experienced at seeing England overburdened with 
taxes, and his hatred of the despotism of the empire, did 
not permit him to be just toward the emperor, nor to 
measure with a correct eye the distance between use and 
abuse. J. B. Say, notwithstanding the superiority of his 
mind, was not inaccessible to political passions, and 
although his writings present few traces of the prepos- 
sessions to which he was exposed during our long politi- 
cal reactions, one cannot help recognizing that he yielded 
more than once to feelings very excusable in those agitated 
times. 

But these generous resentments are much more mani- 
fest in his writings by a few epigrammatic sallies, than 
by passionate theories. The subjects which affect us 
most keenly to-day, those indeed which have at all times 
been privileged to move minds most sensibly, the ques- 
tions of wages and population, seem hardly to move him ; 
he proceeds to the critical examination of them with his 
natural rigidity, and he adopts entirely the views of Mal- 
thus in regard to them. It is here that his writings are 
henceforth vulnerable, and they cannot fail to be sur- 
passed by the school of M. de Sismondi, notwithstanding 
the errors it has committed and its powerlessness, up to 
this time, to find a remedy for the evils of which it has 
given so spirited a picture. J. B. Say considered pro- 
duction too independently of the producers. He was 
captivated by the prodigies of English industries, the 
great manufacturing industries, and he had not time to 
take into account all the evils they entail. He con- 
formed to contemporary prejudice, which considered 
wages as sufficient, not when they produced life, but 



448 HISTORY OF POLITICAL ECONOMY. 

when they prevented death. His studies on the dis- 
tribution of the profits of labor are dominated by the in- 
fluence of capital, and his considerations on the effects 
of public consumption bear too visible indications of his 
bitterness against the abuses of tyranny. There were 
two powers which this great writer treated unjustly, 
though with equal injustice: capital, by giving it too 
prominent a part, and governments, by denying them 
any efficient action on the happiness of citizens.* 

But no one has popularized economic science to the 
the same degree as J. B. Say. It is in vain to reproach 
him with having reduced it to the narrow proportions of 
chreviatistics or the science of wealth : he has very well 
proven that political economy only began to be a science 
when its limits were exactly marked out, and he pro- 
tested in his later writings against the purpose that had 
been attributed to him of wishing to restrict it to an ab- 
stract analysis of the laws of production.f He especially 
detested hypotheses and systems, as the source of almost 
all the evils which have weighed heavily on society ; and 
political economy seemed to him truly useful, only be- 
cause it was called upon to refute successfully the dis- 
astrous prejudices with which the human race is afflicted. 
He leaves, too, not a single objection unanswered ; and 
the usefulness of his works consists much more in the 

* " The insignificant administration of Cardinal Fleury," he said, " proved 
at least that at the head of a government to do no evil is of itself doing 
much good." Discours pre'liminaire, p. 48. 

f "The object of political economy," he said, "seems to have been 
hitherto restricted to an acquaintance with the laws which control the forma- 
tion, the distribution and the consumption of wealth. It was thus that I 
myself considered it in my Treatise on Political Economy, published for the 
first time in 1803. One can see, however, that this science has connection 
with everything in society. Since it has been proven that immaterial prop- 
erty, such as talents and acquired personal abilities, form an integral part' of 
social wealth, and the services rendered in the highest positions have their 
analogy with the most humble labors ; since the relations of the individual 
with the social body and of the social body with the individuals, and their 
reciprocal interests, have been clearly established, political economy, which 
seemed to have for its object only material wealth, has found that it em- 
braced the entire social system." — Complete Course of Practical Political 
Economy, vol. i, p. 7. 



INFLUENCE OF J. B. SAY'S WRITINGS. 449 

errors he has dissipated than in the truths he has dis- 
covered. J. B. Say marked out the first complete pro- 
gramme of poHtical economy, and even the writers who 
do not share his opinions, agree in recognizing the excel- 
lence of his method and the rigorous accuracy of his 
deductions. Thanks to that method, the commercial 
crises which have afflicted France and England at various 
times may be easily explained, and their recurrence may 
be prevented or their effects diminished by efficacious 
measures. 

The influence of J. B. Say contributed more than that 
of any contemporary writer, to extend in Europe a taste 
for political economy. His theories, so naturally appli- 
cable to political questions, were studied with ardor during 
the Restoration as a weapon of opposition and of war ; 
and perhaps they owe a part of their success to the 
services they rendered in the parliamentary discussions 
of the period. Publicists sought in them decisive argu- 
ments against the enormity of the burdens imposed upon 
the nation, and they accustomed themselves to those 
minute analyses of the budget, which later degenerated 
into disputes about figures or quarrels over portfolios. 
J. B. Say did not approve of governments undertaking 
public works, and he severely censured their intervention 
in the industrial affairs of a country. Most of the taxes 
seemed to him as much scourges as hail, conflagrations 
and invasions, and although his philanthropy was sincere 
and profound, he showed himself more hostile to govern- 
mental power than favorable to the toiling masses. He 
perseveringly labored for the latter without seeking their 
favor or fearing their disfavor. He told people and kings 
stern truths, with the unconcerned and stoic impartiality 
of a philosopher occupied only with the interests of 
science and of humanity. The whole French press was 
penetrated with his doctrines, without knowing their 
author, who lived apart, surrounded by his family and a 
little circle of friends, while his works, translated into all 



450 HISTORY OF POLITICAL ECONOMY. 

languages, obtained, in less than twenty years, five suc- 
cessive editions extended to a large number of copies. 

It was, in fact, by the voice of J. B. Say that the first 
attacks were directed in France against the economic 
system of the Restoration. The reaction of 1815 wished 
to restore the right of primogeniture, entail, corpo- 
rations, and privileges ; later, beaten on this ground, it 
tried to make again a landed aristocracy, half feudal, 
half industrial, by raising the duty on iron, which in- 
creased the price of wood and the income of the owners 
of forests. Then came the grain laws, the tax on foreign 
cattle, the emigrant loan, and differential duties on colonial 
sugars ; and each of these measures was blasted before- 
hand in the chapters of the Treatise on Political Economy, 
impressed with the soundest judgment, and which had 
neither been written to this end nor for this case. Entire 
Europe profited by these hard lessons which seemed to be 
destined for France, since they were published in a French 
book ; and more than once, the author found himself 
engaged in a lively contest with the most learned econo- 
mists of his time. Malthus, Ricardo, M. de Sismondi, 
and M. Storch, maintained against J. B. Say memorable 
theses on some points of doctrine ; but all agreed in 
recognizing in him the most indefatigable athlete of 
the science, and next to Adam Smith its most illustrious 
propagator. 

J. B. Say sided with Malthus in his ideas on popula- 
tion. He adopted them fully, freely, without reserve, 
and he caused them to prevail in France up to the time 
when the Saint-Simonian doctrines gave them the first 
blow. His attention was little given to the abuses of the 
English manufacturing system, and he attributed the 
evil of pauperism in that country, to causes purely 
political. The glutting of the markets seemed to him 
only the consequence of commercial restrictions. In his 
view, the reason why there was not enough sold in any 
one place, was because not enough was produced in some 



DOCTRINES OF J. B. SAY. 45 I 

other. Production and consumption were, in his opinion, 
correlative operations, and he sought for no other cause 
of the distress of certain countries than a lack of pro- 
duction in the countries with which they had relations. 
Experience has already taught us that it is not permitted 
to establish commercial relations on that basis alone, and 
that a people ought not to leave the fate of their manu- 
factures exclusively to the chances of external commerce. 
Besides, J. B. Say persistently demonstrated that the best 
consumers of a nation's products were the national pro- 
ducers themselves, to whom the exchange secured regular 
and stable markets, when the incapacity of governments 
put no obstacle in the way. The analyses he gave of 
the mechanism of the exchanges have cast the brightest 
light on all questions connected with them, questions 
very important, since upon them depends the prosperity 
of nations. "Almost all the wars fought for the past 
hundred years, in the four quarters of the world, have 
been for a balance of trade which does not exist ; and 
whence comes the importance attributed to that pre- 
tended balance of trade ? From the exclusive applica- 
tion that has been made of the word capital, to gold and 
silver money." '^ 

It was by such simple and striking statements of facts 
that J. B. Say succeeded in making war unpopular, and 
modifying those national prejudices which tend to per- 
petuate it. This immense work, the mere idea of which 
had caused the Abbe of Saint Pierre to be relegated 
to the rank of visionaries, is becoming accomplished un- 
der our eyes. Far from raising new barriers between 
nations, efforts are being made to break down those 
which exist : bridges are thrown across frontier rivers, 
railroads are built in common, most of the prohibitions 
are becoming suppressed. This fine part of the pro- 
gramme of J. B. Say was carried out before his death,f 

* Treatise on Political Economy, vol. iii, p. 261. 
f d. Nov., 1832. 



452 HISTORY OF POLITICAL ECONOMY. 

and we daily behold the progress of public opinion favof 
the execution of the rest. The only thing in which 
this writer lacked was, not looking at questions of pau- 
perism and wages from a more elevated and more social 
point of view. One feels, in reading him, something 
harsh and repulsive, which recalls the abstract formu- 
las of Malthus and of Ricardo. His logic is merciless 
when he treats of the unfortunates who appear to him 
deservedly so ; and one would say, to hear his severe 
warnings against beneficence,* that it has more encour 
agement for bad conduct than consolation for misfortune. 
But in everything that concerns the great principles of 
the science, in questions of custom-duties, moneys, pub- 
lic credit, and colonies, this author is the safest guide one 
can follow and the most classic writer in Europe. 

The last of his works, which is also the most volumin- 
ous, f presents noteworthy modifications of the first opin- 
ions professed by the author. There is in it less sharp- 
ness against the governing powers, perhaps because M. 
Say had recognized the usefulness of their influence in 
certain cases, or because he thought he owed some sac- 
rifices to the position he occupied. All those who knew 
his character will adopt in preference the first hypothesis, 
which besides is confirmed by remarkable passages, in 
which it is evident that this writer was acting in obedi- 
ence to a new conviction. Thus, in one important case 
he had maintained that the labor of slaves was more 
economical than that of free men ; and he had the good 
faith to publicly acknowledge that he had been mistaken. 
He had no charity for persistence in error, and he let 
pass no occasion of stigmatizing the bad books on polit- 
ical economy. Errors in that science appeared to him 
more disastrous than in any other, and he pursued them 

*" Has the man, who, by his improvidence and idleness, has fallen into 
poverty after having exhausted his means, any claim to help, when his very 
faults deprive the men whose capital supports industry, of their resources ? " 
Treatise on Political Economy, vol. iii, chap 7. 

\ Entitled : Cows Complet d'Economie Politique Pratique, 6 vols, in 8°. 



CHARACTERISTICS OF J. B. SAY. 453 

wherever he thought he saw them, even in his most 
celebrated rivals, in the hope of establishing^ political 
economy on im.pregnable foundations. But it is time to 
notice the labors of those renowned economists. 



CHAPTER XL. 

Political economy in England from the beginning of the nineteenth cen- 
tury. — Pitt's system, supported by Thornton, attacked by Cobbett. — Doctrine . 
of Ricardo. — Writings of James Mill. — Of Mr. Torrens. — Of Mr. Mc- 
Culloch. — Of Mr. Tooke. — Labors of Mr. Huskisson. — Of Sir Henry Par- 
nell. — Treatises of Mr. Wade. — Of Mr. Poulett Scrope. — Economy of 
Manufactures, by Babbage. — Philosophy of Manufactures, by Dr. Ure. 
— Great popularity of political economy in England. 

The long list of English economists subsequent to the 
time of Adam Smith, and the harmony between their 
works, prove ho^y vigorous and prolific had been the im- 
pulse given to political economy by its illustrious founder. 
The ideas which he had just popularized were already 
bearing their fruit. Economic questions had ceased to 
be left to chance, and government itself experienced 
the necessity of submitting its most important measures 
to the supervision of science. People had striking testi- 
mony of this at the period of the suspension of specie 
payments by the Bank of England, in 1797. This was the 
first case in which theories were invoked in support of a 
great financial measure, and from this time the discussion 
passed from the solitude of books into Parliament. The 
movement having once begun, was no more arrested : 
every one thought he must have recourse to the authority 
of principles to support his opinions, and the tribune be- 
came one of the most powerful auxiliaries of political 
economy. Consequently, the Inquiry into the Causes of 
the Wealth of Natio7is may be considered as the source 
of all the good writings published on this subject for 
the last fifty years. 

454 



THORNTON ON PAPER CREDIT. 455 

Before the long struggle of France and England, under 
the influence of our, revolution of 1789, the doctrines of 
Adam Smith had as yet received only one great and 
solemn application, viz., in the Independence of the 
United States. People were doubtless beginning to ap- 
preciate the advantages of division of labor and of the 
employment of machines ; but no serious question had 
as yet put to test the theories of the celebrated Scotch- 
man on the constitution of banks and the evils in the 
monetary system. It was necessary that the adventurous 
genius of a Pitt should risk bankruptcy, for people to 
recognize the accuracy of the analyses which Adam Smith 
had given of the phenomena of the circulation. Then ap- 
peared, at divers intervals, a multitude of works to attack 
or to defend the doctrines of Smith ; and public opinion 
began to be formed in the din of these memorable quar- 
rels. One of the most interesting works published at 
this period,* by Mr. Henry Thornton, had for its aim 
the justification of the suspension of specie payments ; 
and although it abounds in errors, no other work has 
ever given a clearer comprehension of the advantages of 
the monetary circulation, whether in paper or specie. 
The author maintained that banks could indefinitely 
favor labor and multiply production without having need 
of specie, on the single condition of prudently regulating 
their issues. He proclaimed the benefits of credit, in full 
view of a measure which would seem to have annihilated 
it; and the future has justified his most reasonable pre- 
dictions. 

However, towards the end of the year 1810, England, 
exhausted by the efforts she had made to break down 
the power of Napoleon, saw all her gold exported to the 
continent to pay the coalitions, and the price of provis- 
ions rise to a point which rendered very difificult the con- 
tinuation of the financial system devised by Pitt. Then 

"^ An Enquiry into the Nature and Effects of the Paper Credit of Great 
Britain, London, 1802. 



456 HISTORY OF POLITICAL ECONOMY. 

appeared the famous letters by Cobbett,* who attacked 
with indomitable energy the abuses of paper-money and 
the financial deceptions of the government. We know 
no study more interesting than this book for whoever 
desires to estimate at their just value the advantages and 
disadvantages of the system of credit. Never had the 
spirit of a writer to struggle with a subject so difficult, 
and never since the Provinciales of Pascal and the M^- 
inoires of Beaumarchais had more wit been placed 
at the service of reason. Political parties have at- 
tacked Cobbett as a pamphleteer without address 
and without dignity : but posterity,^* more just to him 
than he was to his contemporaries, will assign him 
a very distinguished rank among popular economists. 
If all questions of political economy had been treated 
with that vigorous and simple perspicuity, there would 
not perhaps be to-day one single point of doctrine still 
contested, and this science would have become ac- 
cessible to all classes of the population. Cobbett did 
not seek his arguments in questionable hypotheses or 
in the dogmatic treatises of the writers who had pre- 
ceded him ; he attacked with the simple resources of a 
good judgment, and his inflexible logic threw the bright- 
est light on the most profound discussions. His eco- 
nomic pamphlets, almost all dated from the state-prison 
at Newgate, are masterpieces of reason and of style, and 
cannot be studied too carefully by men desirous of fath- 
oming the mysteries of public credit. 

Almost at the same time, England was enriched by the 
first writings of Mr. Ricardo, which were to throw so 
much light on political economy. It was in 1809; the 
rise of the price of gold and the fall in the exchanges 
which took place that year, had taken strong hold of 
public attention. Ricardo published a pamphlet en- 
titled : The high price of bullion a proof of the depre- 

* Paper against Gold, or the History and Mystery of the Bank of England. 
This enormous pamphlet had more than seven editions. See Appendix. 



RICARDO ON PAPER ISSUES. 45/ 

elation of Bank-notes!^ In it he demonstrated scientifi- 
cally the proposition maintained by Cobbett, namely, the 
disadvantages of too great an issue of paper-money. He 
showed that rise and fall of the course of exchange are 
only relative terms, and that, so long as the circulation of 
a country is composed only of gold and silver money or 
of paper convertible into these forms of money, it is im- 
possible that the course should rise above or fall below 
the course of other countries, by a sum greater than the 
cost of importing specie or bullion in case of scarcity, or 
the cost of exporting a part of the excess, in case of su- 
perabundance. But when a country issues an inconverti- 
ble paper money, as was then the case in England, this 
paper cannot be exported when it is too abundant in the 
country; and consequently whenever exchange with for- 
eign countries falls, or the price of bullion rises alz^ove its 
price in coin, to the amount of the cost for exporting 
the coin, it is evident that too much paper has been is- 
sued, and that its value has fallen by reason of the excess 
of the issues. Ricardo contributed much to the nomina- 
tion of a committee charged with examining this ques- 
tion, and the measures he proposed to remedy the evil, 
though postponed at first through ignorance or malevo- 
lence, were subsequently adopted, mid the plaudits of his 
country and of all enlightened friends of truth. 

It was at this time that the author conceived a bank- 
ing system in which the notes should be exchangeable, 
not for coin, but for bullion. The security of the holders 
of the bills was thus reconciled Avith that of the banks. 
The latter were obliged to restrict their issues, so as not 
to have to increase their security in bullion : and as the 
bullion was not current like money, the banks were less 

* This writing, to-day quite rare, is one of the most remarkable documents 
of political economy, in point of simplicity and clear and practical precision. 
— Author's note. 

Since Blanqui wrote the above, this writing has been published in a collec- 
tion of Ricardo's works edited by J. R. McCulloch (John Murray, London). 
■'—Trans. 



458 HISTORY OF POLITICAL ECONOMY. 

exposed to demands for payment. Nothing was more in. 
genious than this system, since it presented all the ad- 
vantages of credit without having its dangers, and all the 
security of gold money without incurring its expense ; it 
is therefore probable that the attempt will some day be 
successfully made in more than one country.* 

The principal work of Ricardo, The Principles of Politi- 
cal Economy and Taxation, published in 1817, created pro- 
found but diverse sensations in the economic world. 
Some writers have considered it the most remarkable 
work which has appeared since Adam Smith ; others have 
reproached him for having thrown political economy into 
abstractions and iiUed it with algebraic formulas. As a 
simple historian little disposed to enter again into con- 
troversies now exhausted, I will confine myself to point- 
ing out the distinctive characteristics of that work. Ri- 
cardo there maintains that the revenue is entirely foreign 
to the cost of production ; that a rise of wages brings 
about a fall in profits and not in the price of commodi- 
ties, and that a fall in wages brings a rise in profits and 
not a fall in prices. After having proved that the varia- 
tion of profits is in inverse ratio to that of wages, he 
sought to discover the circumstances which determine 
the rate of wages and consequently that of profits. He 
thought he had found them in the expense of producing 
the articles necessary for the consumption of the laborer. 
However high may be the price of these articles, it is 
clear that the laborer must always receive a sufficient 
quantity of them for his subsistence and for that of his 
family. However, as raw products must always form the 
principal part of the subsistence of the worker, and as 
their price has a constant tendency to rise, by reason of 
the constantly increasing sterility of the lands to which it 
is necessary to have recourse in advanced conditions of 
society, it follows that wages must have also a constant 

* This project is set forth in a writing by Ricardo, entitled: Proposals 
for an Economical and Secure Ctirrency. (London, 1816). — Fr. ed. 

This is to be found in McCuUoch's edition of Ricardo's works. — Trans, 



RICARDO'S THEORY OF AGRICULTURAL RENTS. 459 

tendency to rise and profits to fall with the increase of 
wealth and population. In short, the fundamental doc- 
trine of Ricardo on agricultural rents lay in maintaining 
that the profit which a land-owner makes on his land, that 
is to say, what his farmer pays him, represents only the 
excess, for a like expenditure, of the product of his land, 
over the product of the worst lands cultivated in the same 
country. 

This opinion, supported by a remarkable exposition, 
was vigorously attacked by Malthus and by J. B. Say; 
and yet these authors arrived by different paths at the 
same conclusions : only, the opposers of Ricardo main- 
tained that if the bad lands were cultivated, it was the 
extent of the wants of society and the price it was in a 
condition to pay for grain, which permitted a land- 
profit on the best lands or the best situated. To say that 
it is the bad lands which are the cause of the profit made 
on the good ones, was to admit in other terms a principle 
already known, that the cost of production is not the 
cause of the price of things, but that that cause lies in 
the wants the products can satisfy.* The controversy 
raised on this point was then no more than a quarrel of 
words : nevertheless, Ricardo put into his book such high 
considerations on the influence of taxes in the matter of 
incomes, profits, wages, and raw products, that even while 
contesting the theory of the author, we cannot help recog- 
nizing the light he shed on that difficult department of 
the science. It is a pity that this writer should have too 
often made chance suppositions, to deduce from them ab- 
stract and inapplicable conclusions, like a mechanician who 
should estimate the action of machines, without taking 
into account the friction and the materials of which they 
were constructed. Ricardo liked too well to generalize ; 
he often launched out into a sort of economic meta- 
physics, bristling with arguments and difficult formulas,, 
for which people blame the science, although it has suf- 

* J. B. Say, Traits d' Economie Politique, Vol. ii, p. 358. 



460 HISTORY OF POLITICAL ECONOMY. 

fered much from them. Consequently, " under pretence 
of extending it," said J. B. Say, " they have made it 
void.*" 

The greatest reproach that we think can be made against 
Ricardo, is that he considered wealth in an abstract and 
absolute manner, without regard to the fate of the work- 
ers which contribute to its production. Mr. Ricardo was 
much more preoccupied with the collective power of 
nations, than with the individual well-being of the citi- 
zens which compose them ; and his severe logic consid- 
ered men too much as instruments, instead of treating 
them as sentient beings. His book attracts at the first 
glance, by its dogmatic and clearly outlined forms of ex- 
pression. He there treats of human questions in the 
manner of the savants who have established the theory 
of chemical proportions, and who think themselves sure of 
finding in the analysis of certain salts the same quantities 
of acid and of base that they combined there. He sup- 
posed subsidies could be raised for a year of war by an 
equivalent increase of taxes ; and he thought it suitable 
and practicable to pay the public debt^^ by an assessment 
{cotisation) on capital. He was certainly the man who 
has had the most new ideas in political economy since 
Adam Smith ; but the only ones which will survive are 
those he owed to the observation of facts rather than to 
the boldness of his reasoning. The last writing he pub- 
lished on agriculture f contains very profound reflections 
on the influence of the price of grain on profits and wages, 
and the effects of taxation on agriculture and manufac- 
tures. This work alone would suffice to place its author 
in the foremost rank of economists. 

With his qualities and even with his faults, Mr. Ri- 
cardo would naturally found a school : that school al- 

* " The chief of the new school, Mr. Ricardo, it is said, himself declared 
that there were not more than twenty-five persons in England who had un- 
derstood his book.'' Sismondi, Nouveaux Principes, vol. ii, p. 374. 

f A pamphlet of about a hundred pages, entitled : Protection to Agri- 
culture. 



JAMES MILL. TORRENS. MCCULLOCH. 46 1 

ready counts several celebrated disciples, among whom 
maybe mentioned Mr. Mill, Mr.Torrens, and Mr. McCuI- 
loch. James Mill, whom science has just lost,* is principal- 
ly known by his excellent history of British India ; he has 
left an elementary treatise on political economy which 
manifests a little of the obscurity of the master,t and 
which sums up his doctrines as the writings of Justin 
sum up the lost fragments of Titus and Livy. Mr. Tor- 
rens departs further from the fundamental doctrines of 
that school, in his Essay on the Production of Wealth, and 
he accepts the doctrines of his illustrious fellow citizen 
only with considerable reservations. This writer gener- 
ally shows himself eclectic ; he does not attach an exag- 
gerated importance to the verbal disputes which too long 
divided economists, and he explains very well how most 
of the latter are in accord on the essential bases of the 
science. The book that he published in 1834 on Wages 
and Combmations, quite full of generous sympathy for 
the working classes, will be profitably consulted on the 
question of machines and on the circumstances which 
produce a rise and fall of wages in manufacturing coun- 
tries. The author there attacks the corn-laws, as Ricardo 
had done, with an independence very honorable in a 
great landed proprietor. 

For Mr. McCulloch was reserved the honor of pre- 
senting in a popular form the ideas of Ricardo, modify- 
ing them in the superior manner possible to his eminent- 
ly positive and practical mind. The author had already 
published an excellent edition of Adam Smith with notes; 
it then belonged to him more than to any other to make 
known to us the principles of Ricardo, and complete by 
less abstract analyses the labors of that celebrated econ- 
omist. Unfortunately, Mr. McCulloch seems to us to 
have adopted the inflexible absolutism of the manufac- 
*d. 1836. ~ 

f It would, in our opinion, be difficult to find a work of more marked 
perspicuity than that of Mr. James Mill, — Trans. 



462 HISTORY OF POLITICAL ECONOMY. 

turing system which consists in making production ad. 
vance without consideration for the producer, if not 
through indifference to humanity, at least through abuse 
of principles. Mr. Thomas Tooke has been more faith- 
ful to the experimental method of Adam Smith,* but he 
has not kept as closely as several of his predecessors to 
those careful definitions of the words value, utility, and 
■wealth, the precise meaning and application of which 
have been long fixed. Being a practical man and versed 
in the science of affairs, he seizes the most legitimately 
recognized doctrines and applies them immediately to 
industrial questions, as Mr. McCulloch made the most 
happy applications of statistics to political economy.f 
By thus neglecting no occasion to utilize the science, the 
English economists have rendered it popular and raised 
it from the list of Utopias to the first rank among useful 
branches of knowledge. 

Two English ministers, Mr. Huskisson and Mr. Henry 
Parnell have also contributed to this happy result. The 
former of these statesmen, whose recent and premature 
loss science still laments,:}: was not without resemblance 
to Turgot. Impressed with the sad results of the pro- 
hibitory regime and the abuses of the system of protec- 
tion, he had resolved to strike with a bold hand this old 
institution, unworthy of our time and fatal to the progress 
of civilization. But he knew how to ally the spirit of re- 
form with the prudence of a legislator, and he never un- 
dertook any improvement without having first surround- 

* His work, Thoughts and Details on the Idgh and low pi ices of the last 
thirty years , and that entitled, Considerations on the State of the Currency, 
will be read with especial interest. — Author s note. 

His famous History of Prices, and of the State of the Paper Circulation 
from 1798 to 1S57, is more valued for its statistics than for his reasoning 
from those statistics. Some of his extraordinary fallacies and self-refuta- 
tions are pointed out by Col. Torrens in his book on " Sir Robert Peel's 
Bill of 1844."— rra«j-. 

f See his Dictionary of Coinmerce, and his Statistics of England, where 
grave economic questions are often treated with great ability, notwithstand- 
ing difficulties natural to the alphabetical order. 

\ Mr. Huskisson died of injuries received at the opening of the Liver 
pool and Manchester railway, September 15, 1830. 



HUSKISSON ON REFORMS. 463 

ed himself with the most conscientious documents and 
having proceeded to careful investigations. Political 
economy would have seen glorious and prosperous days, 
if this courageous and eloquent minister had lived long 
enough to bring to a good conclusion the reforms he had 
undertaken. " When I speak of improvements," he said 
in the House of Commons, " I mean that temperate and 
gradual melioration which, in every complicated and long 
settled state of society, is the best preservative and guar- 
antee against rash and dangerous innovation. To im- 
provement of that description it is the duty of each of 
us to contribute to the utmost in his power. It is by 
acting steadily upon this principle, that we shall main- 
tain the lofty position which we now hold in the civilized 
world. That position, with all the fame and influence 
which justly belong to it, England has acquired by hav- 
ing hitherto taken the lead in this noble career of useful- 
ness and distinction. In that career, we must go for- 
ward, impelled by the retrospect of past associations, by 
a just sense of our present greatness, and by a due re- 
gard to the obligations which both the past and the pres- 
ent impose upon us, toward those by whom we are to be 
succeeded." * * * " Our country cannot stand still, so 
long as there exists out of doors a free press to collect 
and embody, and a free discussion in Parliament, to guide 
and direct, the influence of public opinion." 

The two circumstances in reference to which Mr. Hus- 
kisson was led to these solemn declarations of principles, 
are too well known for it to be necessary to explain them 
at length. Suffice it to say, that the question concerned 
in the one was the admission of foreign silks, and in the 
other, amendments to the laws relating to navigation, 
which had remained so exclusively restrictive since the 
famous act of Cromwell. Spirited opposition mimedi- 
ately arose from the manufacturers of silks and from the 
owners of vessels, both claiming that the ministry would 
leave the national manufactures defenceless aeainst for- 



464 HISTORY OF POLITICAL ECONOMY. 

eign competition. Mr. Huskisson was not moved one 
moment from his position by this double storm of oppo- 
sition ; and, refuting his adversaries by each other, op- 
posing the recriminations of the latter to the studied 
lamentations of the former, he obtained the finest tri- 
umph that a statesmen can desire, the adoption of his 
measures without any restrictive amendment. A few 
years later the doctrines of his opponents received a 
striking disproof : not only manufactures of English silks 
had not given way before foreign competition, but they 
had increased and become perfected to such a degree as 
to contest successfully with it ; and the sum total of navi- 
gation had surpassed the most exaggerated expectations. 
A few petitioners, pretending to dread the Prussian ma- 
rine on account of the tariff coalition of which this coun- 
try had just become the centre, proposed to e^nploy cannon 
to compel it to recognize the long-established monopoly 
of Great Britain. " I hope," replied Mr. Huskisson, " that 
I shall never bear any share in the councils of England, 
when the principle shall be set up that there is one rule 
of independence and sovereignty for the strong and an- 
other for the weak, and when, abusing her naval superi- 
ority, England shall claim for herself, either in peace or 
war, maritime rights which she refuses to acknowlege in 
other states in the same circumstances. Such a pretention 
would call for and warrant a combination of all the world 
to defeat it." 

Such were the economic and political doctrines of Mr. 
Huskisson during his too short ministerial existence. 
They have not ceased, since his death, to prevail in the 
councils of the British government, and the slowness 
with which we have seen them adopted by civilized 
states, must be attributed to opposition from private in- 
terest, much more than to an unfavorable disposition on 
the part of the administration. All good minds are to- 
day in agreement as to the infallible results of lowering 
the taxes, and enlightened governments hasten to antici- 



SIR HENRY PARNELL. WADE. SCROPE. 465 

pate in that regard the wishes of the people. Mr. Hus- 
kisson has found a worthy successor in Mr. Henry Par- 
nell. This distinguished writer has reviewed the whole 
economic system of England, in a work entitled, Financial 
Reform, which contains the germ of all the improve- 
ments of which English legislation is susceptible, in mat- 
ters of finance, custom duties and commercial interests. 
This work is a model for all governments desirous of 
reforming abuses in a prudent and progressive manner. 
The author sets forth in it all the facts relating to each 
question, and the disadvantages connected with the pres- 
ervation of the present condition, whenever that condi- 
tion seems contrary to the general interests. He shows 
himself more bold than Mr. Huskisson in everything that 
touches freedom of trade, and never have the principles 
on which the necessity of that freedom rests been sup- 
ported by developments more conclusive and arguments 
more irresistible. Sir Henry Parnell has brought forward 
convincing proof of the advantages of reduction of the 
taxes, whether on raw materials or manufactured pro- 
ducts : he has opened a new era in the science by follow- 
ing a system of a particular application of it to each 
economic question, so as to elicit a solution at some not 
distant future. Two English publicists, belonging to the 
same school, Mr. Wade and Mr. Poulett Scrope, have 
recently* published small popular treatises in which 
political economy is brought within reach of the laboring 
classes. That of Mr. Wade is preceded by a historical 
summary of the condition of laborers, and the author has 
there treated in a superior manner the questions of wages, 
pauperism, grain-laws and the influence of education on 
the masses. 

Mr. Poulett Scrope has declared himself a decided an- 
tagonist of the doctrines of Malthus on population, and 
he has risen to high considerations on the phenomena of 
the distribution of wealth. His book is one of those in 

* In 1833. 



466 HISTORY OF POLITICAL ECONOMY. 

which the causes of public and private poverty, as well 
as the effect of restrictions on the exchanges, have been 
the best explained. " The happiness of the human race," 
exclaims the author at the close, " may easily, by means 
of foresight, equal and even exceed the increase of popu- 
lation." The doctrine of Mr. Wade and Mr. Scrope 
differs essentially from that set forth at about the same 
time in the works of Mr. Babbage and of Dr. Ure, on the 
economy of manufactures. The book of Mr. Babbage is 
nothing but a series of ingenious observations on division 
of labor and the employment of machines ; that of Dr. 
Ure is a hymn of praise in honor of the manufacturing 
system, which the author proclaims the most favorable 
for the relief of the working classes. Babbage thought 
that much at least remained to be done by the manufac- 
turers to profit by the industrial discoveries and to im- 
prove the moral status of the laborers. Dr. Ure, a most 
pronounced defender of manufacturing on a large scale, 
skilfully conceals its imperfections and considers it as the 
last term of civilization. 

Such is the dominant character of the English economic 
school ; and it is justly reproached with not taking 
sufficient account of the complications inherent in manu- 
facturing labor, despite the stern warnings of the poor-tax 
and the periodical crises by which England has been 
afflicted for the last forty years. At the sight of those 
increasing thousands of ill-starred children and cor- 
rupted girls in the English manufactories, one is sur- 
prised to read in a work entitled Philosopliy of Manufac- 
tures, such a passage as this : " Where children work at 
home, they are shut up all day long with their parents, 
and they have scarcely any acquaintance with others and 
with the feelings of their neighbors. The whole of the 
feelings which they thus imbibe may be selfish." * But 

'^ Philosophy of Manufactures, by Dr. Ure, London, Book iii, chap, ni, 
pp. 419, 420. From testimony of John Redman before the Farhamentary 
Committee. 



ENGLISH POLITICAL ECONOMY. FRENCH. 467 

the English school has seen, in the production of wealth, 
only an element of national power, aiid the economists of 
that school are too much accustomed to consider work- 
men as simply instruments of production. Scarcely a cry 
of pity escapes them at the sight of the crowded hospitals 
and prisons, filled with all the victims of our social in- 
equalities. They close their ears to the complaints and 
let themselves be dazzled by the prestige of civilization, 
without asking themselves if this splendid edifice is not 
cemented with tears, and if its foundation is so solid that 
there is nothing to dread from shocks. Happily, France 
has claimed her accustomed privilege of defending the 
rights of humanity, and while Great Britain advances 
with giant steps in the industrial career, our writers are 
calling her back to the sacred principles of an equitable 
division of the profits of labor. 

We enter now upon the social era of political economy. 



CHAPTER XLT. 

The social economists of the French School. — New Principles of Political 
Economy, by M. de Sismondi. — New Treatise on Social Economy, by M. 
Dunoyer. — Christian Political Economy, by M. de Villeneuve Bargemont. — 
Treatise on Legislation, by M. Ch. Comte. — Political Economy, by M. 
Droz. 

For several years, the doctrines of Adam Smith, Mal- 
thus, and the industrial school, had been adopted without 
discussion throughout Europe, when M. de Sismondi 
brought out the first serious attack against the abuses of 
these doctrines, while accepting what was positive and 
incontestable in them.* Struck by the contrast between 
the great opulence and extreme poverty of which he had 
been witness in England, and surprised to see the im- 
provements in the industries profit almost exclusively a 
few men, without sufficiently benefiting the community, 
he sought the causes of that anomaly, and he thought he 
had found them in the very constitution of manufactures, 
which was, in his opinion, badly adapted to the general 
necessities of the workers. " I have attempted to prove," 
he said, " that increase of production is a good only as it 
is followed by corresponding consumption ; that likewise 
economy in all the means of producing, is a social advan- 
tage only as each one of those who contribute to produc- 
tion, continues to receive from production an income 
equal to that he received from it before that economy 
had been introduced ; which he can only do by selling 
more of his products." 

* See his first work entitled, Co??tmercial Wealth ; published in 1803, the 
same year as the first edition of the Treatise by J. B. Say. 

468 



SISMONDI ON RESULTS OF MACHINES. 469 

In examining from this new and bold point of view the 
industrial constitution of European society, M. de Sismondi 
encountered the great questions of competition, pro- 
hibitions, banks, and population. It seemed to him that 
competition between the workers would constantly tend 
to lower wages, while the machines furnished by the 
banks were gradually diminishing the demand for labor. 
There was doubtless a greater mass of wealth produced ; 
but the income of the laboring people was not increased 
by it, and consequently their means of subsistence were 
becoming insufificient : hence resulted all the evils with 
which humanity was afiflicted in civilized countries ; and 
M. de Sismondi was led to adopt the theories of Malthus, 
if not as an inevitable fatality, at least as a result of the 
imperfect constitution of industry. Public happiness de- 
pending, in his view, on a just balance between popula- 
tion and income, and the income of the laborers being 
daily reduced by competition and the employment of 
machines, society could not fail to reach a series of catas- 
trophes whose precursors were becoming manifest in every 
direction. Could one not see everywhere within the 
country competition with its ignominious train, the low- 
ering of wages, commercial frauds, and a bad quality of 
products ; and abroad, tariff wars, contrabandage and all 
the crimes which it entails ? 

The new tendency of manufactures, victory by great 
battalions, and the unavailing struggle of labor against 
capital, have inspired in M. de Sismondi eloquent pages. 
He utters a cry of alarm at the sight of the banks adding 
new weapons to the already well tempered arms of those 
who carry on manufactures. If only these ephemeral 
creations of productive instruments benefited the great 
family of workers ! But no ; banks but add to the existing 
means of making the condition of the laborer worse ; they 
multiply machines, reduce the price of a day's labor, and 
by giving an unhmited field to production, they facilitate 
those deplorable gluts of the market followed by crises in 



470 HISTORY OF POLITICAL ECONOMY. 

trade and by ruin in manufactures. Henceforth all ability 
consists in selling at the lowest possible price ; it is re- 
garded as patriotism to have ruined foreign manufactories ; 
but the national manufacturing establishments have been 
treated no better. They have substituted more produc- 
tive, but more expensive machines, for those which for- 
merly existed ; they have obtained a reduction in the rent 
of buildings, in the interest of capital, and in the income 
of landed proprietors. An annual manufacture of one 
hundred thousand francs, when increased to a million, 
puts an end to nine rival establishments ; the new ma- 
chines annihilate the capital represented by the old. 
There is a loss of revenue to society by the diminution 
of the interest of money, by the diminution of the profits 
of manufacture, by the loss of rent on all the establish- 
ments, and by the reduction of the total number of work- 
men and of the wages of each. There is then a diminu- 
tion in the consumption of all these classes ; and while 
the manufacturer works with all his might to increase the 
quantity and improve the quality of the cloths he ex- 
poses for sale, he works quite as effectively to diminish 
the number of buyers of either, and to make all those 
who are becoming impoverished make their clothes serve 
them longer and be satisfied with still coarser qualities.* 
It is not then true, according to M. de Sismondi, that 
the struggle of individual interests, so much lauded by 
the English school, is sufficient to produce the greatest 
good of all ; since, under the influence of that struggle, 
we see every day the most serious complications arise 
and the most crying acts of injustice consummated. So, 
Malthus was right to counsel prudence to the predestined 
. victims of these industrial holocausts which are celebrated 
on the altar of competition ; and our fathers were not so 
much out of the way when they kept in the bonds of 
wardenships and masterships that fatal exuberance of pro- 

* Sismondi on the Revenu Social, in the Revue de V Econotnie Politi- 
que, vol. iv, p. 22Q 



VIEWS OF SISMONDI. HIS ERRORS. 47 1 

duction which has transformed the world into a battle 
field where the great business managers devour the small 
ones. There was at least, under the old regime, a natural 
curb to marriage ; the same restrictions were laid on the 
multiplication of men and of products ; the competition 
of workers and that of merchandise were maintained 
within wise limits. The greatest evil of the present 
social organization is that the poor man can never know 
upon what demand for labor he can count, and that the 
power of working is never an exact and sure income to 
him. Such is, in substance, the doctrine maintained by 
M. de Sismondi in his New Principles of Political Economy, 
and developed by him with superior talent, which has, 
nevertheless, not succeeded in concealing the paradoxical 
side of his system. 

We readily grant that a family which has only a thou- 
sand francs of income, will spend only a thousand francs, 
whatever be the price of most of the provisions which it 
must buy. But, if it procures with these thousand francs 
more articles than it obtained before the diminution of 
the expense of producing them, it will in reality enjoy a 
greater degree of comfort ; it will buy more products and 
will cause greater demands for labor. Let sugar diminish, 
for example, either by a progress in art or by a discovery 
in nature, and a portion of the income formerly devoted 
to the purchase of sugar can be employed in other pur- 
chases and favor new industries or the development of 
those which exist. If the progress in manufactures, the 
perfecting of machines, or the multiplication of the means 
of labor by the banks, were real evils, how could we then 
explain the progressive development of public prosperity 
and that increase of well-being which has penetrated the 
ranks of even the humblest laborers ? Is it not rather 
true that every saving in the expense of production is a 
conquest by which the entire community gains, too un- 
equally, doubtless, but nevertheless incontestably ? M. de 
Sismondi has allowed himself to be led astray by the se- 



472 HISTORY OF POLITICAL ECONOMY. 

duction of a simple and striking idea, like that of Malthus., 
when he proclaimed his famous principle of population ; 
and he thought he had found the true principle of public 
felicity in his theory of the social revenue. But, in truth, 
the illustrious economist only discovered one of the 
pests of industrialism carried to its extreme limits. Dis- 
tressed at the sight of the abuses, he has attacked the 
practice itself, which he has endeavored to render respon- 
sible for all the evils of modern society ; and after having 
described in pathetic terms the sufferings of the laboring 
classes, he has been obliged to confess his inability to 
remedy them. 

His admirable book ends with a cry of despair. " I 
confess," he says, " after having indicated what, in my 
view, the principle is, I feel powerless to indicate the 
means of carrying it out. The distribution of the profits 
of labor between those who cooperate in producing them, 
appears to me vicious ; but it seems to tne almost beyond 
human power to conceive of a state of ownersJiip absolutely 
different from that which experience makes knozvn to usT 
And in fact, M. de Sismondi has well demonstrated that 
the cultivation of the tropical regions by slaves was odious 
and ruinous ; but he has proposed nothing to resolve the 
great question of the emancipation of the blacks without 
injuring their very subsistence and security. He has 
pointed out, with a rare perfection and a perfect acquaint- 
ance with the subject, the abuses of paper money and the 
dangers of money-paper ; but his work offers no compro- 
mise which can be applied in their use. We only know that 
there is a powerful steam-engine which may explode and 
cause victims ; but the author does not speak of a safety- 
valve, and the conclusion would consequently be to re- 
nounce the employment of the machine to escape its 
dangers. The improvements in mechanics have awakened 
his anxiety and at times his wrath ; but he has offered us 
no practical and serious plan to mitigate the rigors of 
those transition periods and long cessations from labor 



IMPROVED CONDITION OF LABORERS. 473 

which keep whole populations in hard circumstances. 
There are social plague-spots, originating in the times 
and customs, slow in forming, slower in healing, over 
which it is not enough to lament in eloquent jeremiads, 
to make them disappear. Surely not all capitalists are 
merciless, nor all workmen without foresight ; but how 
many premature marriages ! how many children who 
ought not to have been born ! How many harvests de- 
stroyed by storms ! How many unforeseen wars ! How 
many commercial crises difficult to foresee ! Here is 
what daily bafifles the theories of the economist and the 
calculations of the statesman. These are maladies which 
accompany growth, but they do not arrest it. 

M. de Sismondi has been the historian of that transi- 
tory and distressing part of the developments of modern 
industry. No writer had hitherto shown a more noble 
and touching sympathy for the laboring classes ; none has 
more energetically stigmatized the selfishness of the rich 
and the heedlessness of the men charged with watching 
over the interests of the greater number. His book is 
the best critical work in existence in political economy ; 
but a better book will be that which shall refute it. The 
sslightest observation of facts suffices to demonstrate that 
the condition of the laboring classes is to-day much su- 
perior to what it was before the discovery of the great 
machines of modern industry. The workmen, even the 
worst paid of them, participate indirectly in the benefits 
of civilization ; they go about the streets cleaner and 
better informed ; they receive the gratuitous advantages 
of an elementary education ; they travel more comfort- 
ably and more economically than their fathers, and every 
day sees wealth or at least a competency reach numerous 
classes to whose lot it would never have fallen but for 
the improvements in machines. The principal defect in 
the method of M. de Sismondi lies in generahzing too 
much, like Ricardo himself, his most illustrious opponent. 
He IS not at all cautious ; he goes straight to his end, and 



474 HISTORY OF POLITICAL ECONOMY. 

he sometimes deduces exaggerated conclusions from a 
reasonable principle. The abuse of banks in England and 
the United States, where they only serve to enrich those 
who are rich and to multiply machines without know- 
ing how their products will be disposed of, has appeared 
to him a sufficient reason for the maledictions with which 
he pursues these valuable instruments of public fortune. 
*' Capital so easily obtained," he says, " incites to hazar- 
dous enterprises, which the authors would have hesitated 
to undertake, if they had been obliged to risk their own 
funds." This is true, doubtless; but is the necessity of 
suppressing banks a legitimate conclusion from it ? M„ 
de Sismondi has not recoiled, as to machines, from the 
rigorous conclusions from his system. He does not hesi- 
tate to declare that a new industrial improvement would 
be a national misfortune ; for the number of consumers 
can hardly be increased, according to his ideas, and the 
number of producers would diminish by the employment 
of the new machines. He asks what would become of 
England if governed by a king who. by means of an im- 
mense crank, should perform all the tasks of his subjects, 
who were dying of hunger because his powerful machine 
had taken away from them all their work. And we an- 
swer at once that England would be a very fortunate 
country to be able to rely for its subsistence on the care 
of a ruler capable of executing by himself alone such im- 
mense labors. 

Notwithstanding the paradoxical character which dis- 
tinguishes them, the opinions of M. de Sismondi' have 
exercised great influence in Europe. It was he who first 
revealed the secret of those social troubles principally 
occurring in manufacturing countries, and who gave warn- 
ing of the danger of banks, much before the recent catas- 
trophes which have so sadly justified his predictions. 
Thanks to him, the condition of the workman has become 
a precious and sacred thing ; he has his place at the ban- 
quet of life, from which the theories of Malthus would 



SERVICES OF SISMONDI. 475 

have excluded him ; and henceforth progress in wealth 
will be considered truly an advantage, only as its benefits 
extend to those who have cooperated in it. The prin- 
ciple is established : it belongs to legislators to deduce 
the conclusions. Already, profound industrial and com- 
mercial questions have fallen within the domain of 
parliamentary discussion ; it will not be long before 
they will be resolved, under the auspices of the new 
economic school,* with the generosity of sentiment and 
the lofty views which should characterize a special jury 
of savants. 

M. de Sismondi has given proof of true courage in be- 
ing the first to point out, with a firm hand, the dangers 
of the artificially and blindly productive system lauded 
by England and adopted by most of the economists of 
Europe. Surely if a courageous man had been needed 
to call public sympathy to the lot of the working men, 
victims of a selfish and one-sided organization, that man 
would not have been lacking in France ; but it was neces- 
sary to explain the hidden faults of that system ; it was 
necessary to show how private poverty increased at the 
same time as public wealth, and by what afflicting con. 
trast the profits of labor are more frequently con- 
centrated in unoccupied hands than at the fireside of the 
laborer. Mc de Sismondi has not solved this problem, 
but he has shed much light upon it and has boldly stated 
it to economists and statesmen. Since then, prohibitions 
have begun t'o take on a different aspect from that of 
former times ; the fictitious impulse they give to produc- 
tion has been found to have a compensation in the re- 
straint they put on consumption. We have seen that 
the mechanic lost, in his character of consumer, all which 
the heads of protected industries gained in their position 
of manufacturers. The cooperation of machines, so en- 
ergetic and so useful, when its aim is to economize the 

* Witness the question of prisons, that of slavery, that of the labor of 
children in manufactories, the great enterprises of public charity, etc. 



47^ HISTORY OF POLITICAL ECONOMY. 

time and the toil of men, appeared murderous as soon as 
it had been proven to result too frequently in crushing 
humanity in its gearing. Perhaps M. de Sismondi, deeply 
moved in view of the sufferings so common in manufac- 
turing countries, has exaggerated evils which did not all 
depend on the same cause ; but it will be to the eternal 
honor of his name to have sounded the alarm in Europe* 
and put himself at the head of the most unjustly disfa- 
vored classes of our social order. We shall soon hear his 
cry of alarm, repeated with a solemn voice by the Saint- 
Simonians, resound in the midst of our cities and in the 
tumult of insurrections — a mournful warning which poli- 
tics cannot disregard nor science leave longer unavailing! 
Numerous writers have hastened to respond to the 
generous appeal of M. de Sismondi. Among the most 
intelligent advocates of his doctrines, France counts the 
author of Christian Political Economy, the Viscount Al- 
ban de Villeneuve-Bargemont, whose investigations in 
regard to pauperism have obtained less success than so 
commendable a work merited, because of the evident in- 
sufBciency of the therapeutic part. M. de Villeneuve sur- 
passes even the mournful complaints of M. de Sismondi 
in regard to the manufacturing system : he depicts in 
most vivid colors the evils of every kind by which the 
laboring classes are overwhelmed ; but the remedies he 
proposes are those of an apostle rather than of an econo- 
mist or an experienced administrator.! However great, 

* See especially chapters xii, viii and ix of the seventh' book of his New 
Principles of Political Economy. 

\ " What appears certain," he says, " is that the times of monopoly and 
oppression are forever ended, and that a great transition is approaching. 
Now, this can take place only in two ways ; either by a violent irruption of 
the proletary and suffering classes upon the property-holders and man- 
ufacturers, that is to say, by a return to a state of barbarism ; or by a prac- 
tical and general application of the principles of justice, of morality, of hu- 
manity and of charity. All the genius of politics, all the efforts of men of 
property, must then tend to prepare that transition by ways of persuasion 
and wisdom. Evidently the world calls for a new phase of Christianity. :|: 
Christian charity, finally put into action in politics, laws, institutions, and 

% The Saint-Simonians called their doctrine at one time by the name of New Chris' 
tianity. This is the title of one of the writings of Saint-Simon. 



RELIGION INADEQUATE TO THE TASK. 477 

in fact, may be the resources of the religious mind, they 
cannot remedy all social diseases. Christian charity alone 
cannot provide for the material wants of humanity. It 
is desirable, without doubt, that it should penetrate poli- 
tics and morals ; but even supposing it to penetrate them 
deeply, it would still have to be ascertained if its inter- 
vention would be sufficiently efficacious to cure an evil 
as inveterate and as inherent in civilized society as the 
poverty generalized under the name of pauperism. At a 
period now remote, the religious spirit had sovereign 
sway, without being able to remedy human miseries, and 
if there were then fewer poor in Europe than in our day, 
it was because there were fewer inhabitants. 

We cannot doubt, however, that public poverty is a 
great social fact, peculiar to modern states, and manifest- 
ing itself more and more as civilization advances. Must 
it be admitted that such a fact is inevitable or fated, or 
that it depends on human institutions to modify it in a 
favorable way? If politics can do nothing for it, will 
religion be able to do more ? The author of Christian 
Political Economy has sincerely entertained this latter 
hope ; and I regret to say that the reading of his book 
does not permit me to share it. His conclusions are 
nearly the same as those of M. de Sismondi ; everything 
is committed to the hands of God, and the author would 
freely take refuge in prayer, so great is his fervor and so 
sincere his piety ; but what can prayers effect in the face 
of the terrible and keen reality? in vain does M. de Vil- 
leneuve recall regretfully the old system of corporations 
and the monastic life which wisely limited the increase 
of population : of what use is it to regret what has ceased 
to be in harmony with present customs, in a word, what 
is no longer possible ? It is doubtless easy to bring for- 
ward in evidence the embarrassments which savants and 

customs, can alone preserve the social order from the frightful dangers which 
menace it : outside of that, we venture to say, there is naught but illusion or 
falsehood." 



478 HISTORY OF POLITICAL ECONOMY. 

statesmen experience in solving this formidable problem ; 
but the hand of the priests in our days* is far more 
powerless to give us an equitable solution of it. M. de 
Villeneuve was not able to obtain any results from his 
ideas, although he preached to hungry people moral f 
restraint, frugality, temperance and other like virtues, 
with Malthus and the apostle Paul. He is reduced 
to regretting the loss of the religious celibate while at- 
tacking the doctrines of Malthus, which counsel absti- 
nence for other reasons, and to deploring the services of 
machines, notwithstanding the relief they have brought in 
the hardest kinds of labor to the working classes. Political 
economy has then received no new light from that elo- 
quent lamentation, in which M. de Villeneuve has de- 
plored all the sufferings of human society without pro- 
posing any efficacious remedy to cure them. His conclu- 
sion is this: 1st. Moral, religious and industrial mstruc- 
tion given gratuitously and with obligation to profit by 
it, by means of charitable schools at the expense of the 
communes. 2nd. Banks to encourage economy and- fore- 
thought, established at the expense of manufacturing 
towns and communes, or of charitable associations, 
with obligation on the part of the workmen to put in 
them a portion of their wages, when the rate of the lat- 
ter will permit without inconvenience. 3rd. The institu- 
tion of corporations of workmen, which, without em- 
barrassing industry and having the fatal results of the 
old masterships and wardenships, would favor the spirit 
of association and mutual helpfulness, give certificates 

* M. Guizot has well expressed that powerlessness in a fragment published 
by the Revue Frangaise. " In our days," he says, " by the course of events 
and by reciprocal errors, religion and society have ceased to understand each 
other and to walk side- by side. The ideas, the feelings, the interests which 
now preva.il in temporal life, have been, and daily are, reproved in the name 
of the ideas, feelings and interests of the life eternal. Religion pronounces 
anathema on this new world and holds itself separate from it ; the world is 
ready to accept the anathema and the separation." 

f " Abstinence from marriage could never be more efficaciously inspired 
in the poor than by the religious sentiment. " £con. Polit. Chr/tienne, vol. 
i, p. 235. 



M. DROZ. FRENCH SCHOOL. SISMONDI. 479 

of instruction and of good conduct and take the place 
of the deplorable institution of trade-unions.* But 
it is evident that these palliatives, otherwise salutary, 
could have no important influence on universal competi- 
tion, the abuse of political privileges, the struggle of 
great amounts of capital with small fortunes, and the 
unfair distribution of taxes. 

M. Droz seems to us to have more justly estimated the 
true character of political economy. " Let us not take," 
he says, " riches for an end ; t/iej/ are only the means. Their 
importance results from the power of mitigating suffering, 
and the most valuable wealth is that which serves for the 
well-being of the greatest number of men. The happi- 
ness of states depends less on the quantity of products 
than on the manner of their distribution. No country is 
so remarkable as England in respect to the formation of 
wealth ; in France, its distribution is better ; hence I 
conclude there is more happiness in France than in Eng- 
land. In reading Certain economists, one would think 
that products were not made for man, but that man was 
made for products." 

Such is the direction given to the science by the econ- 
omists of the new French school, which I call the social 
school, because it refers all progress to the general im- 
provement of society, without regard to race or caste, 
pursuing with the same anathemas the trade in blacks and 
the exploitation of the whites. M. Droz is the one of 
all the writers of that school who has most clearly stated 
its programme, without hostility to the present or illu- 
sions in regard to the future. M. de Sismondi, of a mind 
eminently critical, had to uproot widely-spread prejudices 
in favor of names most respected in science ; and he 
could not help, in his generous ardor, being more than 
once almost led into a paradox. He, too, according to 
the expression of Malthus, having found the bow bent 
too much to one side, believed in the necessity oi forcing 

* Economic Politique Chre'tierine, vol, iii, p. 156. 



48o HISTORY OF POLITICAL ECONOMY. 

it to the other, and for this reason his doctrines have not 
produced all the fruit humanity might expect from them. 
He expected too much from governments, as M. de Vil- 
leneuve expected too much from Providence ; but Provi- 
dence and governments have made severe conditions for 
man ! 

Two works remarkable in different ways, the Treatise 
on Legislation, by M. Charles Comte, and the New Trea- 
tise on Social Economy, by M. Dunoyer, have recalled 
economists to more just if not as attractive ideas of the 
true difificulty of economic questions. M. Comte, faithful 
to the experimental method followed by J. B. Say, has 
demonstrated by historic facts, selected with much judg- 
ment and most ingeniously compared, that most of the 
obstacles to social improvements come from those who 
would derive most profit from them, and who are per- 
petually conspiring to hinder their accomplishment. He 
has shown how the fatal habits of servitude corrupted the 
masters while brutalizing the slaves, and how much op- 
position has awaited, at every conquest of civilization, the 
devoted men placed in the vanguard. " For," he says,* 
" the nature of things or of men is not modified accord- 
ing to our desires. The founders of slavery never suc- 
ceeded in exempting the masters from all evils, nor in 
securing for them the monopoly of enjoyments ; the men 
who have attempted to distribute pleasures and pains 
equitably among all the members of society, have suc- 
ceeded no better. The first failed, because they had to 
contend with human nature ; the second failed, because 
they had to contend with the same obstacle." It seems 
to me that such a confession from the lips of a writer 
whose entire life has been devoted to labors for civiliza- 
tion, merits the consideration of generous minds who 
might be disposed to adopt with enthusiasm the doc- 
trines of M. de Sismondi or of the Christian Political 
Economy. 

* Treatise on l^egislation, vol; iv, p." 503. 



DOCTRINES OF M. DUNOYER. 481 

M. Dunoyer has censured still more severely the dream- 
ers of indefinite perfectibility in political economy. In 
his opinion, the initiative in improvements of every kind 
belongs to nations. " It is the agriculturists who perfect 
agriculture ; the arts are advanced by artists, the sciences 
by savants, politics and morals by moralists and poli- 
ticians. Only there is this difference between things 
which are the private affairs of each and those which are 
the affairs of everybody, jhat, in the former, the improve- 
ments are applicable immediately for the one who dis- 
covers them, while in the second, i.e., in politics, the ap- 
plications can be made only whert the thought of the 
publicist has become the common thought of the public, 
or at least of a very considerable portion of the public. 
Until then, attempts to realize them will only be ineffec- 
tual. A civil power, amicably disposed towards such re- 
forms, may possibly undertake to establish them ; but it 
will not accomplish a lasting work. The object may pos- 
sibly be attempted in defiance of the civil power, by a 
party overthrowing the latter and taking its place : but 
the most fortunate insurrections will have no more effect 
than the most benevolent concessions. The change 
aimed at will only become established after a long time, 
and in proportion as it passes into the ideas and habits 
of the greater number.f * * * Thus, in the social 
state most exempt from violence, it would be almost 
impossible that inequalities in conditions should not be 
established ; and when these inequalities are once estab- 
lished, it is still more difficult for them to be effaced. 
People never, except with extreme difficulty, rise from 
an inferior condition to a higher state, and families in a 
certain degree of abasement are liable to remain so, sim- 
ply because they are there." 

Such is the severe character of the doctrines of M. 
Dunoyer that we can do no better than to contrast therr 
with the adventurous philanthropy of M. de Sismondi 

f New Treatise on Social Economy, vol. i, p. 9. 



482 HISTORY OF POLITICAL ECONOMY. 

and the religious preaching of M. de Villeneuve and M. 
de La Mennais. M. Dunoyer is, no less than these gen- 
erous writers, pervaded with a lively sympathy for the 
suffering classes, of which the greater part of the human 
race is composed ; he, too, would wish for them days 
more prosperous and destinies more pleasant ; but his 
cool judgment obliges him to repress the glow of unre- 
flecting emotion and not to admit blindly the possibility 
of an equal state of happiness for all, as if all men had 
the same intellectual and moral value and the same 
rights to an assured tranquillity ; which would destroy 
every principle of activity, honesty and virtue. M. Du- 
noyer has had the courage to tell the people stern truths 
which others address to kings. He has well demon- 
strated that it is imprudent and rash to promise all men 
an ocean of felicity of which it is given only to a very 
few to get a glimpse even of the shores. Civilization, 
which is nothing else than progress towards the general 
welfare, is itself subject to rigorous, slow and gradual 
conditions, which suppose above all the cooperation of 
those whom it is attempted to render more happy. It is 
consequently to these that this economist has addressed 
himself, to show them the inevitable laws of industrial 
and social progress. This progress seems to him im- 
possible without the inequalities of which it is erroneous- 
ly supposed that he would bring about the entire aboli- 
tion. It is by these inequalities that division of labor 
exists, without which there would not be sufficient pro- 
duction to meet the wants of society. Where would 
the workmen be, if all wished to carry on business for 
themselves ? What would become of an army all of 
whose soldiers claimed to be generals? 

M. Dunoyer has developed this proposition, a bold one 
in these times, with a rigor of logic and a clearness of lan- 
guage not common. He has not been at all moved by the 
clamors which it might raise, sure of his intentions and 
of the assent of enlightened friends of economic progress. 



M. DUNOYER ON CAUSES OF POVERTY. 483 

His somewhat rigid morality is not hostile to improve- 
ments compatible with our complicated social state, and he 
frankly acknowledges that, if it is not possible to secure to 
all men an equal sum of material advantages, it is a thing 
practicable and at times easy, to ameliorate relatively 
the particular condition of any single one.. But every 
one must help himself by the practice of social virtues, 
such as labor, economy, and forethought, which are con- 
ditions of success, as temperance is a condition of health. 
Society can no more secure advantages to all its mem- 
bers than physicians can a cure to all their maladies. To 
maintain the contrary, would be to flatter all human pas- 
sions and to prepare the way for their outbreak under 
favor of impunity. M. Dunoyer nevertheless recognizes 
that the principal causes of poverty proceed from the un- 
equal division made at first of wealth by the original dis- 
possession of the most numerous classes of society, from 
the state of servitude in which they were kept for cen- 
turies, from the taxes by which they are crushed, from 
the laws which prevent them from getting the best pos- 
sible advantage from their labor, and from all the vicious 
institutions which attack them in their subsistence or 
their morality. " However," adds the author, " the con- 
dition of the lower classes does not alone proceed from 
the wrongs the higher part of society may have been 
guilty of toward them; it has also its root in their 
especial vices, their apathy, their heedlessness, and their 
ignorance of the causes which make the price of labor 
rise or fall. Their distress is at least as much their own 
fault as that of the classes that may be accused of having 
oppressed them ; and, if society should be reestablished 
on more equitable bases, if the strong should abstain 
from every sort of domination over the weak, I do not 
doubt that there would still be developed a more or less 
numerous class of miserable beings at the bottom of 
society." 

Surely, these are severe warnings and well suited to 
calm the exaltation of those philosophers who think they 



484 HISTORY OF POLITICAL ECONOMY. 

can attribute exclusively to the fault of institutions the 
moral and physical sufferings of several millions of men. 
M. Droz, whose noble sentiments as an economist and 
moralist no one will contest, had already made it clear 
that science and administration could not alone" provide 
for all the wants of humanity. While proclaiming clearly 
that the aim of political economy was to render comfort 
as general as possible, he had allowed himself no illusion 
as to the limits of its influence, which is like that of 
law in constitutional cduntries, that is to say, subject 
to the essential condition of a perfect harmony between 
all the powers. Differing from the principal found- 
ers of the social economic school, who denied that gov- 
ernments and institutions had any responsibility for 
public miseries, M. Dunoyer and M. Droz thought that 
responsibility should be shared by the people governed, 
who too often are a dead weight upon the most useful 
reforms. They desired the cooperation of the laborers 
in the distribution of the profits of labor, and the con- 
currence of all forces in the work for the amelioration 
of the condition of all. Here, if we mistake not, we 
have a new phase in the history of the science, and we 
• know not to which of the economists who have brought 
it about is due the most gratitude, to those who, with M. 
Sismondi and M. Villeneuve, have revealed the grievances 
of the poorer classes, or to those who have recalled these 
classes to a true sense of their dignity and their duties, 
like M. Droz and M. Dunoyer. The two former authors 
have taken wealth to task, and have reproached it for its 
selfishness; the two others have chided poverty and 
blamed its heedlessness : a double task, difificult to ac- 
complish, and one which will some day bear its fruits, 
when the time has come for a compromise between the 
present and the past, between the capitalist and the 
laborer ! That compromise has been unsuccessfully at- 
tempted by the economists of the school which I shall 
call eclectic ; we will take a cursory view of its most diS' 
tinguished representatives. 



CHAPTER XLII. 

Eclectic political economy and its principal representatives. — M. Storch, 
— M. Ganilh. — M. De Laborde. — M. Florez Estrada. 

The great economists of the latter part of the eigh- 
teenth century, authors of the celebrated treatises in 
which science came forth for the first time in a methodic 
form, had almost all adopted absolute theories which ex- 
perience and facts would necessarily modify. Thus the 
Physiocrates had considered land as the only source of 
value : Adam Smith had accorded this honor only to la- 
bor ; Ricardo subordinated all the phenomena of the cir- 
culation to his theory of rent ; M. de Sismondi to that 
of revenue ; J. B. Say to the extent of access to markets, 
that is to say, to freedom of trade ; Malthus attributed 
most social maladies to excess of population ; Godwin 
censured the indifference of governments. It was evi- 
dent, however, that if these causes combined had some 
influence on social development, none of them could be 
regarded as the exclusive cause, that is to say, the doc- 
trines of the economists were applicable only to certain 
cases and certain conditions. While they were making 
war to maintain their systems against one another, there 
became established among their pupils intermediary 
shades, a virtual emanation from those bright and de- 
cided colors which particularly distinguish the founders. 
The writers whose works best represent these shades of 
transition, are very numerous in Europe. They have not 
a stamp of their own ; they have invented nothing, dis- 

485 



486 HISTORY OF POLITICAL ECONOMY. 

covered nothing ; but they have admirably perfected the 
work of their predecessors and softened the asperities of 
the absolute theories from which the reason or the preju- 
dice of contemporaries recoiled. 

M. Henri Storch is in the foremost rank of these eclec- 
tic economists, seeking the truth in good faith, in the 
agricultural system as well as in the industrial regime, 
and disposed to make concessions to both. A judicious 
observer, and conveniently situated * for judging well a 
multitude of special facts, M. Storch knew how to borrow 
from his predecessors, like a man already rich in his own 
funds, and he cast much light on the question of slavery, 
in the country where it seemed most difficult to speak 
freely upon it. He does not belong exactly to any 
school, and he would have deserved to found one, on ac- 
count of the importance of the documents which he has 
contributed to science, if the boldness of his mind had 
corresponded with the extent of his knowledge. In his 
view, political economy had no other aim than to procure 
for men the means of satisfying their moral and physical 
needs, and to teach them to produce well in order to 
place them in a condition to consume with profit. This 
is attained by labor, as every one knows ; but, hitherto, 
only the action of free trade had been studied : M. Storch 
has explained the phenomena of forced labor, that is to 
say, that of slaves, so common still in Russia,f that it 
powerfully contributes to the national wealth of that em- 
pire. In the same way, the author makes the sledge, 
which is unknown among most of the people of Europe, 
figure among the means of transport. Nothing could be 
more ingenious than his theory of the relative wealth of 
the nations, which he classes as lomiing, borroiving and in- 
dependent, as also his fine analyses of the income of talents 

* M. Storch was instructor to the grand-duke Nicholas, late emperor of 
Russia. He spoke, with an independence which honors alike his country 
and his character, of the fatal effects of slavery in all countries. 

f Serfdom in Russia has since been abolished by Alexander II, and al] 
peasants have been entirely free as to their persons since 1863. — Trans. 



MORAL CAPITAL. M. STORCH ON RENT. 487 

and qualities ; analyses so much the more worthy of at- 
tention as they demonstrate the superiority of that ele- 
ment of wealth, too long neglected, which I first pro- 
posed to call moral capital."^ Moral capital is nothing 
else than the sum of the capacities of every kind by 
which nations become enriched while becoming civilized, 
and which permits them to daily increase their wealth 
and their civilization. 

At the time when M. Storch published his lessons to 
the Grand-dukes of Russia, the doctrine of Ricardo on 
farm-rent, which he calls rent of land, had not yet ap- 
peared ; and I confess that the theory of the Russian 
economist seems to me much more simple and more nat- 
ural than that of the celebrated British writer. M. 
Storch C2\\s ground-rent the price paid for the use of land ; 
priniitive-rent, the rent of uncultivated land, founded on 
the exclusive right the proprietor has to dispose of his 
land ; and rent of improved land, the rent of the improve- 
ments at the current rate, combined with the primitive 
rent. " The rent of fertile lands," he says, " determines 
the rate of all other lands which compete with them. 
Accordingly, so long as the product of the most fertile 
suffices for the demand, the less fertile lands cannot be 
worked, or at least pay no rent. But, as soon as the de- 
mand surpasses the quantity of products that fertile 
lands can supply, the price of the product rises, and it 
becomes possible to cultivate the less fertile lands and to 
derive a rentf from them." It is remarkable that this 
doctrine is exactly the same as that which Ricardo de- 
veloped at almost the same time in England, drawing the 
conclusion that it is the least fertile lands which deter- 
mine the rate of the rent of all the others. It would be 
too tedious to enter here into the reasons which make 
me adopt in prefere nce the theory of M. Storch ; but I 

* See Blanqui's lessons at the Conservatory of Arts and Trades, published 
in 1837. ^ 

f Course of Political Economy, book iii, chap. xii. 



488 HISTORY OF POLITICAL ECONOMY. 

consider the developments by which he has accompanied 
it one of the most remarkable labors which has honored 
political economy. 

Storch was less original, but more profound, in his ex- 
planation of the theory of money, where he tried to keep 
the balance between the extreme partisans of banks and 
the exclusive defenders of coin. He had had a near view 
of the abuses of issues of paper and of debased coin ; 
and his long experience permitted him no illusion as to 
the disadvantages of assignats, by whatever name it 
should please the government to baptize them. How- 
ever, his account of the functions of banks cannot be 
compared with the immortal effort of Adam Smith on 
the same subject. M. Storch has completed the demon- 
strations of the great Scotchman ; he has enriched them 
with a multitude of examples drawn from the financial 
history of all nations, and he has been the first to make 
known the organization of almost all the banks of Eu- 
rope. By his work, one can become acquainted with 
them and learn how to distinguish clearly the dangers 
against which they have to guard. The latter part of this 
important book is devoted to consumption. The author 
has well explained in it the reasons why commerce and 
manufactures cause a more rapid increase in wealth than 
agriculture. What he says of the effects of slavery, prin- 
cipally in Russia, the only country perhaps where slavery 
still exists as a social institution, merits the consideration 
of economists and does the greatest honor to the inde- 
pendence of the writer. It was not without cause that 
we ranked him among eclectics : his sound sense, the 
moderation of his character, his great erudition, which 
seems unacquainted with no previous work, give him a 
title to that appellation, nobly justified by an impartial- 
ity so much the more worthy of eulogy, as the author 
was, as is generally known, imperial preceptor at the 
court of St. Petersburg. 

We should also count among the eclectics the indefati- 



GANILH, DE LABORDE. ASSOCIATION. 489 

gable Ganilh, the author of Systems in Political Economy, 
who died * recently at a very advanced age, without hav- 
ing left any truly original creation. Ganilh was more of 
a financier than economist, and his labors contributed 
more to the progress of financial science than to the ad- 
vancement of political economy. Besides, most of his 
works have not survived the circumstances which gave 
rise to them. He wrote under the regime of censorship, 
and he sought to reconcile the circumspection demanded 
by imperial susceptibility, with the interests of truth 
which sincerely occupied his mind. Nothing at that time 
seemed to indicate the gravity of the questions which 
our day would have to resolve; M. Ganilh followed 
quietly the usual beaten track of discussion about net 
product and raw product, the restrictive system and free- 
dom of trade ; but France, distracted by the tumult of 
battles, gave little heed to his numerous writings. His 
merit consists in not having despaired of the future of 
the science and in having connected for it the links in 
time, broken by the clash of arms. Ganilh did in polit- 
ical economy as recluses do who have withdrawn from 
the world, who write for themselves without concern as 
to the effect their books will produce, and moreover, 
without adapting them to the wants of their time. These 
works are to science what summaries are to history. He 
was the sole economist of the Empire. 

The Essay on the Spirit of Association, by Count De 
Laborde, published in 181 8, obtained much greater suc- 
cess. This book is especially remarkable for the accuracy 
of its previsions and for its excellent appreciation of the 
institutions most favorable to the development of public 
prosperity. All forces were divided in France as well as 
all opinions, when M. De Laborde published this exposi- 
tion of the advantages of the spirit of association, rich 
in facts and full of luminous ideas on the true sources of 
the industrial and politica l power of states. In this book 

* Died in 1836, aged 78. ~ 



490 HISTORY OF POLITICAL ECONOMY. 

we find well expressed the sufferings manufactures and 
commerce had to undergo under military rule,* the new 
formalities to which they had to submit, and the delays 
of the bureaucracy unfortunately introduced by the ad- 
ministration into the legislation concerning labor. M. 
De Laborde nevertheless recognized the utility of the in- 
tervention of the government in questions 'of public 
wealth and material production ; but he wished it to 
be according to the principles of a division of labor, with- 
out despotism, and without encroachment on the rights 
exclusively vested in manufactures. This was the way 
he understood associations for public credit, associations 
for labor, associations for the protection of labor. The 
army had its role here, as commerce had its own, and as 
the government employes had theirs. The author would 
have a working country moderately governed ; and with- 
out adopting the absolute doctrine of free trade, he 
thought it advantageous to rely on individual intelligence 
and the competition of interests. 

These judicious doctrines have by degrees penetrated 
people's minds ; and since then we have seen savings 
banks, insurance companies, joint-stock companies {so- 
cietes en eommandite),^^ at once the effect and the cause 
of the increasing prosperity of the nation. M. De La- 
borde has very happily demonstrated the influence that 
foreigners, attracted to our associations by the hope of 
increasing their capital, would have on that prosperity. 
This idea, a bold one at the time when proposed, is begin- 
ning to become so popular in France, that a proposition 
was even made, for a moment, to establish between the 
Bank of France and the Bank of England relations quite 

* " The greatest defect of the miperial government," said M. De Laborde, 
"was that constant jealousy of manufactures and commerce. It extended 
its spirit of domination to the smallest matters, and it would have liked to 
carry on all branches of manufacture for its profit, as it directed all affairs. 
It was a trader in sugar, coffee, printed calicoes, proprietor of all woods, 
seller of sheep, administrator of canals, undertaker of public works, man- 
ager of the property of the communes, of the hospitals, farmer of the 
games," etc. {Spirit of Association,^. ^.) 



TRIUMPHS OF ASSOCIATION. 491 

like those which exist between many merchants by the 
intervention of accounts current. This was a prelude to 
the reforms from which some day the new doctrines of 
manufactures and commerce will arise, when universal 
competition, crowding back on each nation the products 
of its manufactures, will force them all to sign a compact 
finally divested of the spirit of monopoly and prohi- 
bition. And what to-day are these enterprises of steam- 
boats, railroads, and canals, which tend to unite all 
states by mutually dependent lines of communication, 
but the commencement of the great fusion of European 
interests ? 

Never, perhaps, has any economic doctrine received the 
sanction of experience to such a degree as that of asso- 
ciation. Its very eclecticism, that is to say, the compro- 
mise it effected between facts and principles, could but 
contribute to favor its success. Hence it has constantly 
advanced from victory to victory, and we have seen 
within a few years all Europe asking from the spirit of 
association the realization of a great number of enter- 
prises which seemed not only beyond the power of indi- 
viduals, but even beyond that of governments. There is 
no longer anything impossible for these armies of work- 
ers who are marching on to the conquest of wealth with 
the accumulated forces of an entire people, and who 
know how, in their way, to conquer rivers, level moun- 
tains or tunnel them, at the will of industry. Before 
that time, people had only attempted to associate things ; 
since they have undertaken to associate men, everything 
around us has changed in appearance. There are coun- 
tries which this powerful lever has almost suddenly ren- 
dered unrecognizable: witness North America, whose 
virgin forests are traversed by railroads, and whose rivers, 
lately solitary, are covered with flotillas of steam-boats. 
There are now two portions of the public wealth, one 
of which goes to the treasury, the other reverts to 
labor ; a profound revolution, which brings manufactures 



492 HISTORY OF POLITICAL ECONOMY. 

and government, production and consumption, constantly 
face to face, on the footing of equality ! Beneficence 
even has borrowed new resources from the spirit of asso- 
ciation, and our modern civilization has no finer gem in 
its crown, than those numerous philanthropic societies of 
which Christianity is the principle, and association the 
means. 

Economic eclecticism has even penetrated into Spain, 
that old land of absolute doctrines : and one of her most 
honorable exiles, M. Florez Estrada, has given us, under 
the title of Eclectic Course of Political Economy, one of 
the most remarkable treatises that have been published 
since that of J. B. Say. The method of M. Florez Es- 
trada resembles somewhat that of the celebrated Russian 
economist, Henri Storch. He begins by conscientiously 
examining the opinions of his predecessors, which he 
adopts or refutes according to the degree of value which 
that examination has made him recognize. In this way, he 
has added really new considerations to those of Malthus 
on population. His fine exposition of the doctrines of 
Ricardo on rent, is accompanied by a series of subtile and 
ingenious analyses, which raise this piece of criticism to 
the rank of original creations. No writer before M. 
Florez Estrada, had approached the questions of taxa- 
tion with that deep insight which characterizes him ; and 
although the author has given particular attention to the 
taxes levied in his own country, statesmen of all other 
countries will find in this work useful suggestions and 
valuable information. M. Florez Estrada has incontes- 
tably demonstrated the inequality and injustice of the 
fiscal system which weighs to-day upon all the nations of 
Europe, and the necessity of introducing into it impor- 
tant modifications at some not distant day. By some 
wholly new ideas, he has completed all the discussions 
relative to banks, paper-money and circulation, taking up 
these questions at the point where Adam Smith, Ricardo, 
J. B. Say and M. de Sismondi had left them. The Eclec^ 



SERVICES OF M. FLOREZ ESTRADA. 493 

tic Political Economy would be an excellent book for stu- 
dents if some ambiguities of expression did not detract 
from its simple and regular arrangement. Such as it is, 
however, this book may be considered as the necessary 
complement of all those which have preceded it : me- 
thodical with Say, social with Sismondi, algebraic with Ri- 
cardo, experimental with Adam Smith, it differs in many 
respects from these grand masters, and it shares in their 
good qualities without falling into all their errors. 

Being a Spanish citizen, M. Florez Estrada would nat- 
urally have in view the interests of his country, and he 
has pointed out with rare plainness the evil results of the 
economic system which has ruled Spain since Charles V. 
The questions relating to tithes, entailment, primogeni- 
ture, and majorats, have nowhere been treated better 
than in his book. Here one can study, even better than 
in the work of Jovellanos, the real causes of the decline 
of Spain and of the harm which the bad economic laws 
which have afflicted this fine country for more than three, 
hundred years, have caused her. M. Florez Estrada has 
criticised them with a breadth of view which extends even 
to the fiscal organization of the principal powers of Eu- 
rope ; and his fine analyses of the influence of taxes on 
the various industries, remain the necessary starting point 
of all the reforms of which these taxes are susceptible. 
Such are the essential claims of the author to the grati- 
tude of economists ; and we regret that he did not touch 
upon social questions, upon which no one was more ca- 
pable than he of throwing a strong light. M. Florez Es- 
trada, in doctrine, belongs to the English school : he is an 
advocate of the system of Malthus, and his theory of the 
rent of land is no other than that of Ricardo, perfected 
and illustrated by comparisons and examples alike in- 
genious. M. Florez Estrada has, moreover, shown him- 
self more eclectic in regard to persons than in regard to 
things. Production seemed to have attracted his atten- 
tion much more than consumption, and although he pro- 



494 HISTORY OF POLITICAL ECONOMY. 

posed to add to the ordinary programme of political 
economy a division relating to the exchanges, his piece of 
criticism was arrested by the complications to which the 
industrial system exaggerated by England and already 
naturalized in France, daily gives rise. Most of the eclec- 
tic economists, except M. De Laborde, have shared this 
reserve, which we should call timidity, had it not been 
demonstrated to us that in the opinion of these writers, 
freedom of labor and freedom of trade would suffice to 
bring to a good end all the difficult social evils of our 
time. But each country has its problem to solve, and 
when the final moment has come, it is not by hesitating 
between doctrines equally powerless that we can hope for 
a serious and permanent solution. In the present state 
of things, eclectic political economy is no longer anything 
but an experimental science, while the progress of events 
demands a political economy of action. When govern- 
ments, overcome by the wave of conflicting interests, 
demand of science categorical answers, the latter cannot 
remain vague and take refuge in dissertations : the re- 
forms which have become necessary must be executed 
with that impartial and prudent zeal which distinguished 
Mr. Huskisson. Such was the bold attempt of a school 
henceforth celebrated, in spite of its errors, and whose 
efforts have failed for having lacked moderation, but 
have left a luminous track behind. This school is that of 
Saint-Simon, and it aimed to be to the old political econ- 
omy what the Constituent Assembly was to the old re- 
gime, and, like that Assembly, it passed away in a 
tempestuous storm. 



CHAPTER XLIII. 

Saint-Simonian political economy. — First writings of Saint-Simon. — 
Boldness of his attacks. — Theory of his disciples. — 'Y\v& Producteur. — What 
they meant by Industrialism. — They found a church. — Their attacks against 
inheritance. — General view and estimate of their labors. 

When the first writings of the Saint-Simonians saw 
the light, all the great questions propounded by the econ- 
omists were awaiting a solution. Europe had never taken 
a more active part in that controversy, notwithstanding 
the uncertainties which it involved, and which were daily 
increased by the debates kept up by the chiefs of the 
various schools. At the same time, the immense develop- 
ment of manufactures, promoted by the general peace, 
had given rise to new complications, which it was neces- 
sary to remedy by measures that would be efficacious and 
adapted to the circumstances. The time had come to 
act, as we have said : numerous diseases afflicted the so- 
cial body: pauperism was invading manufacturing coun- 
tries more and more ; people had witnessed distressing 
and unforeseen commercial crises, without a hope that 
they would disappear for a long time. On all sides dis- 
cussions were raised relative to wages, to foundlings, to 
openings for trade, without governments daring to take 
the initiative in those decided measures which either de- 
stroy the evil or aggravate it, according to the skill with 
which they are applied. It was in this state that Saint- 
Simonism found France and Europe, when its first pub- 
lications began to awaken public attention. The doc- 
trines of that school have exercised too much influence 

4qS 



496 HISTORY OF POLITICAL ECONOMY. 

on the course of political economy to permit us to pass 
them over in silence, even in presence of the stormy con- 
tests they have raised. 

A man, eccentric and misunderstood during his whole 
life, became, probably without his knowledge, whatever 
his disciples may say in that regard, the founder of the 
sect of Saint-Simonians. He was the Count of Saint-Si- 
mon, a descendant of the celebrated family of this name, 
and had been in his youth on the American expedition, 
and was reduced, during the rest of his career, either by 
the misfortune. of the times, or by personal excesses, to a 
precarious and miserable existence. It appears that in 
the midst of these vicissitudes, Saint-Simon, already oc- 
cupied with projects of reform, had formed the plan of a 
reorganization of society on bases which seemed to him 
preferable to all those which the economists of his time 
proposed. He operated by means of a series of short and 
substantial publications which summed up his ideas under 
incisive and picturesque forms of expression. In one of 
these regenerating pamphlets,* he proposed to put the 
spiritual power into the hands of the savants, the tem- 
poral power into the hands of the property-holders, and 
to pay governments for their services. But his counsels 
had little success at that period. It was towards the end 
of Napoleon's reign, and circumstances were scarcely fa- 
vorable for Utopias of this kind. Saint-Simon found the 
field more free at the beginning of the Restoration ; and 
in 1819, he brought out the first clear and bold expression 
of his industrial theories. The little writing that he pub- 
lished, under the title of Parabole (parable), was extreme- 
ly remarkable, coming from a man of such high extrac- 
tion, however modest might be his present fortune. In 
it Saint-Simon developed, under the form of a jesting 
hypothesis, his favorite doctrine of the supremacy of the 
industrial occupations over all the other occupations in 
society. He feigned not to conceive how it was that 

* Letters of an inhabitant of Geneva to his contemporaries. 



PARABLE OF ST. SIMON. 497 

the men most competent in arts and manufactures did 
not occupy the highest positions in the state, in virtue 
of their quaHty of creators of all products and con- 
sequently of all wealth ; and the inferior situation in 
which he saw them seemed to him the world turned up- 
side down. See how he expresses himself in his parable, 
from which we quote literally an extract to give at the 
same time an idea of his style and of his practical 
views : 

" I will suppose," he says, " that France suddenly loses her fifty first phy- 
sicians, her fifty first chemists, her fifty first printers, architects, physicians, 
in a word her three thousand first artists, savants, and artisans. 

" As these men are the Frenchmen most essentially producers, those who 
give the most imposing products, those who direct the labors most useful to 
the nation, and who render it productive in the fine arts and in the arts and 
trades, they are really the flower of French society : they are of all French- 
men the most useful to their country, those who bring it the most glory, who 
advance the most its civilization and its prosperity. France would need at 
least one entire generation to repair this misfortune, for the men who dis- 
tinguish themselves in labors of public utility, are virtual anomalies, and na- 
ture is not prodigal of anomalies, especially of this kind. 

" Let us pass on to another supposition : let us admit that Finance keep all 
the men of genius she possesses in the fine arts and in the arts and trades : 
but that she has the misfortune to lose on the same day Monsieur, brother 
of the king, Monsigneur the duke of Angouleme, Mgr. the duke of Berry, 
Mgr. the duke of Orleans, Madame the duchess of Angouleme, Madame 
the duchess of Orleans, Madame the duchess of Bourbon, and Mademoiselle 
de Conde. 

" That she lose at the same time all the great officers of the crown, all the 
ministers of State, all the Mattres des requHes, all the marshals, all the 
cardinals, archbishops, bishops, grand-vicars and canons, all the prefects and 
sub-prefects, all the employes in the minister's office, all the judges, and 
more than that, the ten thousand richest proprietors among those who live 
like nobles. 

" This accident would certainly grieve the French, because they are good, 
and could not behold with indifference the sudden disappearance of so 
great a number of their fellow countrymen : but that loss of thirty thousand 
individuals reputed the most important in the state, would cause them sorrow 
only in a purely sentimental way, because no harm would result to the 
State. 

" First, for the reason that it would be very easy to fill the places which 
had become vacant. There are a great number of Frenchmen living who 
could exercise the functions of brother of the king as well as Monsieur ; 
many are capable of occupying the positions of the princes, just as well as 
Mgr. the Duke of Angouleme, Mgr. the Duke of Orleans, etc. 

" The antechambers of the castle are full of courtiers ready to occupy the 
place of grand officers of the crown ; the army possesses a great quantity of 
military men, who are as good captains as our present marshals. How 
many clerks are worth our ministers of state ? how many administrators 
more fitted to carry on the affairs of the departments than the prefects or 
sub-prefects now in active service ; how many lawyers as good juriscon- 
sults as our judges? How many curates as capable as our cardinals, as 



498 HISTORY OF POLITICAL ECONOMY. 

our archbishops, as our bishops, as our grand-vicars and our canons ! As to 
the ten thousand land-proprietors, their heirs will need no apprenticeship to 
do the honors of their drawing rooms as well as they." 

This audacious pamphlet produced sufficient sensation 
to excite the anxiety of the magistrates and to obtain an 
acquittal notwithstanding their prosecutions. It was the 
programme of the industrial power which Saint-Simon 
proposed to establish, and it was soon followed by a mul- 
titude of other publications which have been carefully 
collated, since, by M. Olinde Rodrigues, one of his dis- 
ciples. The most curious of these writings bore the title 
of The Organizer, the Catechism of the Industrial Interest ^ 
the Industrial System. " We invite," it said, " all per- 
sons engaged in the arts and manufactures who are zeal- 
ous for the public welfare, no longer to suffer themselves 
to be designated by the name of liberals ; we invite them 
to set up a new standard and to inscribe on their banners 
the device ; industrialism. The designation of liberalism 
having been chosen, adopted and proclaimed by the rem- 
nant of the patriot and of the Bonapartist party, that 
designation has very great disadvantages for men whose 
essential tendency is to constitute a solid order of things 
by pacific means. We do not pretend to say that the 
patriots and Bonapartists did not render service to society. 
Their energy was useful, because it was necessary to de- 
molish before being able to construct. But to-day the 
revolutionary spirit which animated them is directly con- 
trary to the public good ; to-day a designation which does 
not indicate a spirit directly contrary to the revolution- 
ary spirit, cannot be suitable for enlightened and well in- 
tentioned men." We have quoted these various passages 
in order to call attention to the strange amalgamation of 
contrary sentiments which distinguished the Saint- 
Simonian doctrine at that first period of its development. 
Since then, that school has constantly professed a sort of 
blind respect for the precepts of authority, even to the 
point of investing it with the chief surveillance over all 



THE "PRODUCTEUR" — ITS DOCTRINES. 499 

the processes of labor and of thus creating a universal 
intervention of the administration in the affairs of all 
private individuals One readily conceives that Saint- 
Simon might have had so much the more inclination for 
this despotism of authority, because, according to his 
ideas, it was into the hands of the workers that it would 
naturally fall. 

It is not for us to examine here the purely religious 
portion of the doctrines of Saint-Simon, as it appears in 
his Nezu Christianity, a very remarkable work in which 
the author has proclaimed the urgent necessity of ameli- 
orating the fate of the poorest and most numerous classes. 
Still less shall we criticise the metamorphosis of all that 
industrial school into a metropolitan church having its doc- 
trines and its casuists. This part of the history of the 
Saint-Simonians belongs to the history of religious errors, 
as well as the attempts at the emancipation of woman and 
the succession of audacious acts by which these attempts 
were accompanied. Our aim is only to point out the 
economic labors of the sect and the results accruing from 
these labors. Immediately after the death of Saint- 
Simon, his disciples published, under the name of the 
Producteur, a periodic journal which aimed to propagate 
the doctrines of the master, adapting them to the neces- 
sities of the times, and with reservations from which they 
judged proper to free themselves after the revolution of 
1830. However it came about, the authors of this journal 
had certainly succeeded in spreading among the most ad- 
vanced men of the press, ideas favorable to the develop- 
ment of industrial power, and in weakening the importance 
which was then attached exclusively to political means. 
They attacked by simple and vigorous arguments the old 
prohibitory system which had been aggravated by the Res- 
toration : they pointed out with calm and dignified pride 
the importance of the role of the savants, manufacturers 
and artists, the new trinity of the religion of love and 
labor which they proposed to establish. From this 



500 HISTORY OF POLITICAL ECONOMY. 

period, a real change becomes effected in the absolute 
ideas of the press militant, the guide of popular opinion 
in France : military tendencies lose much of their sway ; 
war is obliged to render up its accounts, and for the first 
time in a long while, people begin to perceive that there 
exists, outside of the classes privileged by fortune and 
politics, an immense mass of workers whose turn has come 
to figure on the world's stage and to have their legitimate 
representatives. 

The Saint-Simonians had reached this point when the 
revolution of July occurred. I think I do not exaggerate 
the importance of their writings in affirming that it was 
under their inspiration that the troubles of the period 
took that social character which excited so deep an in- 
terest throughout Europe. The Prodiicteur had ceased 
to appear, but only to be surpassed. A new Exposition 
of the Saint-Simonian doctrine, maturely discussed in 
council by the pontiffs of the great college, boldly pro- 
claimed the abolition of inheritance and the classification 
of positions according to capacities. We perceive how 
much this dogma would please human vanity, always dis- 
posed to judge itself with benevolence, and what flatter- 
ing results the men who had nothing to lose might derive 
from the abolition of inheritance. The Saint-Simonians 
shrewdly profited by the circumstances which had given 
to the insurgent masses a victory illustrious for the most 
admirable disinterestedness of which history makes men- 
tion. They commented like practical men on the famous 
mot of Sieyes : " The Third Estate is everything," and they 
determined that the Third Estate of 1830 should not be 
reduced to the slender proportions of a bourgeoisie. But 
while in their language, they chose the most pacific forms, 
the masses, little enlightened, were marching straight to 
their end, and endeavoring to obtain, by means of insur- 
rections, the reahzation of that deceptive promise : " To 
every one his capacity, to every capacity according to its 
works," Bold commentators were not lacking, to show 



SAINT SIMONIAN DOCTRINE OF PROPERTY. $01 

the painful contrast of the poverty of some and the opu- 
lence of others. More than one orator of the street cor- 
ners readily demonstrated the great advantages which 
humanity would derive from the abolition of these odious 
inequalities, which were represented as veritable spolia- 
tions. Such was not, however, the idea of the Saint- 
Simonians in publishing their celebrated creed. They 
had not heard community of goods preached, nor that 
with which they were later reproached, community of 
wives ; and the manifesto they addressed on this subject 
to the house of deputies leaves no doubt as to their real 
intentions. Here is the most remarkable passage in that 
document : 

"The system of community of goods is universally understood to mean 
an equal division among all the members of the society, either of the pro- 
ducing capital, or of the results of the labor of all. 

" The Saint-Simonians reject this equal division of property, which 
in their view would constitute a violence greater, an injustice more revolt- 
ing, than the unequal division primitively effected by force of arms, by con- 
quest. 

" For they believe in the natural inequality of men, and regard that in- 
equality as an indispensable condition of the social order. 

" They reject the system of community of goods, for such a community 
would be a manifest violation of the first of the moral laws which they have 
received a commission to teach, and which requires that in future every one 
shall be situated according to his capacity and rewarded according to his 
works. 

" But, in virtue of' that law, they demand the abolition of all privi- 
leges of birth, without exception, and consequently the destruction of inheri- 
tance, tlie greatest of these privileges, the one which to-day embraces them 
all, and whose effect is to leave to chance the distribution of social privileges 
among the small number of those who wish to lay claim to them, and to con- 
demn the most numerous class to depravity, ignorance and poverty. 

"They demand that all the instruments of labor, the land and capital 
which to-day constitute the divided up lands of private proprietors, be 
worked by association, under the direction of hierarchs, so that the task 
of each one may be the expression of his capacity, and his wealth the meas- 
ure of his works. 

" The Saint-Simonians propose to interfei-e with the constitution of 
property only in so far as it sanctions for some the impious privilege of idle- 
ness, that is to say, of living on the labor of others ; only in so far as it leaves 
the social classification of individuals to the chance of birth." 

Notwithstanding this protest of the Saint-Simonians, 
it was easy to see that their attacks upon the transmis- 
sion of property would end in an actual spoliation of 
families. They thus threatened citizens in the enjoy- 



502 HISTORY OF POLITICAL ECONOMY. 

ment of the one of their rights considered as the most sa* 
cred : they struck a blow at the dearest hopes of fathers, 
and they struck the fortune of society itself by stifling in 
man the most energetic stimulant to labor and economy. 
Who, pray, should exercise in each country the functions 
of distributor of enjoyments and of duties? What intel- 
lect would be found sufficiently high, and what spirit suf- 
ficiently impartial to be secure from error and injustice? 
It could not be less than a high priest, as infallible as the 
pope, and besides a sovereign dispenser of the products 
of labor. The adepts of the doctrine did not shrink from 
even this difiiculty, and they gave themselves this sov- 
ereign disposer of pleasures and punishments, under 
the name of father-supreme. From this time, Saint-Si- 
monism degenerates into a sort of mundane theocracy 
and ceases to stop at the limits of economic Utopias. It 
is no longer considered as a school, but as a church, and 
it is already pursued by the ridicule which mercilessly at- 
taches in France to all founders of churches. At the 
same time, the crazy attempts at the emancipation of 
woman result in discrediting what might be good and 
useful in the other Saint-Simonian propositions. People 
include them all in a common reprobation. They laugh 
and they grow indignant at that contest between two 
eminent personages of the sect, one of whom, a married 
man, claims that in a family every child should be able 
to know its father, while the other, a celibate, maintains 
that the woman alone should be called upon for a solu- 
tion of that grave question. Serious men no longer see 
anything but a mental debauch in this outbreak of hcen- 
tious propositions which lead to subversion of the family 
and of property. The magistrates become alarmed, so- 
ciety is aroused. In vain the Saint-Simonians organize 
churches, and give the key to their enigma in eloquent 
sermons to which their words attract rich and poor with a 
sort of irresistible fascination ; in vain even that they have 
the art to gather in adherents and multiply proselytes; 



SAINT SIMONIAN DOCTRINE OF INHERITANCE. 503 

their decline is approaching, and their most rational theo- 
ries are confounded with the wanderings of their imagi- 
nation. The insurrections which are breaking out on 
every side pass for the fruit of their excitation ; and in 
the presence of flowing blood, laughter gives place to 
wrath. The authorities cause their halls of conference to 
be closed, and the courts prosecute them as disturbers of 
the public peace. 

What a sad end for beginnings which appeared so fa- 
vorable ! Who would have believed that the learned 
analyses of the processes of manufacture, published by the 
Producteur, would have for a conclusion community of 
wives and the creation of di father -supreme \ But in spite 
of these extravagances, one profound thought had sur- 
vived the dispersion of the Saint Simonians, a thought 
separated from the impure alloy of the sensualities of the 
Rue Monsigny/'^ This thought had been formulated by one 
of the principal representatives of the sect : " Society, 
according to them, is composed only of idlers and work- 
ers. Politics should aim at the moral, physical, and intel- 
lectual improvement of the fate of the workers, and the 
progressive forfeiture of the idle. The means are, as to 
the idle, a destruction of all privileges of birth, and to the 
workers, a classing according to capacities and remuner- 
ation according to the work. The Saint-Simonians very 
well understood that it would be impossible for them, in 
the present state of society, to attain their end at once ; 
so they themselves proclaimed the necessity of a gradual 
transition, and they rejected the idea of an immediate 
suppression of the privilege of inheritance. Their pro- 
ject was to first promote the abolition of inheritance in a 
collateral line to remote degrees, in order to insensibly 
accustom minds to more decided reforms. They wished 

* In this street, the Saint-Simonians had established the head-quarters of 
their worship, when they made priests. They gave soirees there which 
were quite popular, and conferences which were not less so. It may be 
that the intoxication of these parlor successes contributed not a little to the 
tendency towards epicureanism which led these remarkable men astray. 



504 HISTORY OF POLITICAL ECONOMY. 

to make the value obtained by the state from the prop- 
erty which would be added to to its domain, and the 
product from the right of succession in direct line, which 
would have been considerably augmented, serve for the 
reduction of taxes. By means of this newly created bud- 
get, they would give an active impulse to all branches of 
industry, dig canals, lay out roads, raise public monu- 
ments and found the institutions for instruction demanded 
by the wants of the country. 

One cannot to-day read without a lively interest the 
views they each day presented in the journal Le Globe, 
which had become their property. Singularly enough, 
this journal had previously belonged to an association of 
distinguished men, whom the tide of 1830 carried into 
power. What the former Globe had attempted to ac- 
complish for thought, for the middle classes, the Saint- 
Simonians claimed for labor, for the inferior classes. 
They took an active part in all the reform projects 
favored by the renovating movement of July. Their 
sheet, distributed gratuitously to the number of several 
thousand copies, treated with incontestable superiority 
the questions of finance, public works, banks, associations 
and pauperism, and we must allow that never did any 
company of savants put in circulation a like fund of 
ideas. These ideas were certainly not always just, nor 
always practicable ; some of them were often strange and 
their expression was marked by an affected use of new 
phrases ; but as minds have become calmed, the posterity 
which is beginning for the Saint-Simonians have got rid 
of the alloy, and much pure material has remained at the 
bottom of their crucible. To them it is that we owe the 
industrial tendency of the present period, and the direc- 
tion, perhaps too exclusive to-day, of all activities towards 
this end. By restoring the worship of labor, whether by 
their preaching or by their analyses, they attracted the 
attention of the civil power and of the higher classes to 
the laboring classes, to whom they had been too long 



SERVICES AND ERRORS OF SAINT SIMONIANS. 505 

indifferent. Their learned expositions of the theory of 
banks, their original views on the system of mortgages, 
on the insufficiency of the public instruction, and on 
foundlings, have familiarized men wholly unacquainted 
with economic science, with the fundamental principles 
of that science. While the economists were discus* 
sing theories, the Saint-Simonians were trying coura- 
geously the hazards of practice, and were making, at their 
risk and peril, experiments preparatory to the future. 
Their personal disinterestedness equalled their religious 
enthusiasm for the cause they had embraced ; and not- 
withstanding the contrary accusations which have been 
brought against them, it is an averred fact that they all 
went forth from their temples or their workshops poor or 
ruined. 

I will say nothing of the attempt, unfortunate to them- 
selves, they made in withdrawing to the heights of the 
village of Menilmontant, with the intention of glorifying 
labor there. It was a deplorable spectacle to see skilful 
chemists, distinguished engineers, original and profound 
thinkers, abased to the lowest rank of laborers, and re- 
duced by an aberration of their own will to the most 
vulgar labors of domestic life. In acting thus, they de- 
graded intelligence, and failed to comprehend the first 
rules of division of labor. What would they have said, 
they so seriously hierarchical, if the laboring classes, leav- 
ing the plowshare or the hammer of industry, had seized 
the domain of intellect while the chiefs of the industrial 
religion were humbly devoting themselves to manual la- 
bors? What a contradiction between the actions and 
the words ! And this was not the only one : we are sur- 
prised, in studying their doctrines, at the independence 
of the principles and the absoluteness of the prescrip- 
tions: we find it difificult to associate these projects for 
the emancipation of the laborers with the severe rules 
which were imposed upon them. The Saint-Simonians 
have one point of resemblance with the Physiocrates, 



506 HISTORY OF POLITICAL ECONOMY. 

from whom they seem to have borrowed the dogma of 
passive obedience and of an idolatrous respect for au- 
thority. That error, however, was less injurious than 
useful. People in France had, under the Restoration, 
become too much accustomed, and, unfortunately, with 
some reason, to find fault with the civil power : they ob- 
served it with mistrust, they obeyed it with ill humor. 
A systematic hostility received most of its measures and 
paralysed their effects ; so that public authority became 
daily weakened, to the great detriment of the prosperity 
and dignity of the country. The Saint-Simonians, to- 
ward whom the civil power showed itself very ungrateful, 
taught the French people that a government is good for 
something: this was indeed something new in the times 
then passing, and especially at a time when every one 
considered it to his credit to have contributed to the 
overthrow of the dynasty which had just fallen. Saint- 
Simonism attempted to arrest all the hands armed with 
destructive weapons, that a first fire of enthusiasm, sud- 
denly suppressed, had not yet disaccustomed to demoli- 
tion : it wished also to arouse in the heart of the higher 
classes sympathies for the more humble, which they had 
rarely experienced. One may fail in that noble task, by 
committing errors ; and who does not commit them, even 
while doing good ? But there always remains a luminous 
trace from these bold attempts, which succeeding gener- 
ations never fail to take up again on another plan. To- 
day the Saint-Simonians, scattered among the people, 
have resumed the exercise of the professions to which 
they were severally destined by their former studies. 
They construct railroads, they make journeys useful to 
their country ; they are managers of manufacturing estab- 
lishments, and everywhere we see them at the head of 
projects for improvement. They honor their past by the 
dignity even of their silence, satisfied with having' pro- 
pounded the most grave questions of the present time, 
and having prepared the principal elements of tiieir solu- 



SAINT SIMONIANS. 507 

tion. Europe, which scoffed at them, follows their coun- 
sels, and the government which persecuted them employs 
them. Is it thus that people treat the vanquished ? 



CHAPTER XLIV. 

The Utopian economists. — The societary system of Fourier. — Review of 
his principal works. — Fundamental idea of his doctrine.— Developments of 
which it appears susceptible. — The jcia'a/ system of Mr. Owen. — Ineffectual 
attempts made by him at New-Lanark and at New-Harmony. — Sketches of 
the peculiar views of that economist. 

In chronological order, the Saint-Simonians were not the 
first reformatory economists of the nineteenth century. 
A few years before the publication of their writings, two 
men remarkable in difTerent ways, Mr. Fourier and Mr. 
Owen, had laid the foundation of a reform called societary 
by the former, and social by the second ; the latter found- 
ed on the community, the other on association. Both 
started at the same point, without tending to the same 
end : both were impressed by the uncomfortable condi- 
tion of contemporary society, the vices of our morals, the 
sufferings of the greater number of our fellow creatures^ 
and the necessity of terminating them ; but they differed 
essentially as to the means. The Saint-Simonians created 
more of a sensation and thrived better, because the chief 
of their school, being taken away the first from his dis- 
ciples, left ardent and resolute followers, to whom noth- 
ing would have been wanting to secure the triumph of 
his doctrines, if any great renovation could have resulted 
from them. 

The ideas of Fourier and. Owen have obtained only 
very lately the favor of that noisy publicity which com- 
mands attention and sometimes success. Fourier died a 

508 



FOURIER, OWEN, AND SAINT SIMON COMPARED. 509 

little more than a year ago, and Mr. Owen is still living.* 
These two circumstances explain the different interest 
felt in the preaching of the Saint-Simonians and the 
writings of Owen and Fourier. However, the attempts 
of these two philosophers preceded by several years the 
labors of Saint-Simon, and they present themselves un- 
der an organization more complete and more vast than 
that of the Saint-Simonian school. Fourier, Avhom his 
disciples wish to-day to have considered a great man, evi- 
dently has an advantage over his two rivals in the bold- 
ness of his views and the admirable stability of his charac- 
ter ; more than they, he claimed to have solved the social 
problem, and he accused all contemporary economic doc- 
trines of barrenness, without perceiving that he only 
brought, as they did, his share of uncertainties and va- 
garies to the universal centre of all the doubts and Uto- 
pias of civilization. A rapid survey will enable us to judge 
of his doctrines. 

Fourier had been early impressed by the conventional 
falsehoods with which the social order is infested. He 
had seen childhood struggling with imperious passions 
and exacting masters ; later, in society, his honesty had 
revolted at the tricks of trade, family discords and politi- 
cal corruption. He had been shocked at the contrast of 
honest poverty and opulent vice. Before his reason had 
demonstrated to him that Providence must have had 
higher views, his heart had bewailed the contradictions 
and bitter disappointments of our society. What then ? 
In the presence of this magnificent spectacle of nature, of 
this sun which shines for all, of these fruits so abundant 
and so savory, of these fountains so limpid, there are men 
who live in darkness, who languish in hospitals, in pris- 
ons, who die of hunger and thirst ! There are men a 
thousand times more unhappy than the beasts, since they 
have to submit to moral torture, beside physical suffer. 

♦Fourier died October 10, 1837, aged 65, and Owen, December, 185S, at 
the age of 87 years. — Trans. 



510 HISTORY OF POLITICAL ECONOMY. 

ing ! Everything would advance with a regular step in 
this world, except humanity itself ! Was the house so 
beautiful and the light of the stars so brilliant, only to 
illumine the unutterable griefs of the master ! What 
blasphemy and what absurdity ! 

Struck by this contrast as by a revelation, Fourier 
sought for its causes with the persevering and profound 
sagacity which distinguished him. It seemed to him that 
the passions, burdened with all the weight of our iniqui- 
ties, could be made to serve for our good, and that it was 
easy to utilize them, like any living force, by assigning 
to them an intelligent and reasonable employment : thus 
he laid the foundations of his system in the first of 
his works, the Theory of the Four Movements. These 
four movements took the names of social movement, ani- 
mal movement, organic movement and material move- 
ment. The theory of the first was to explain the laws 
according to which God regulated the arrangement and 
succession of the various social mechanisms in all in- 
habited globes. The theory of the second would explain 
the laws according to which Providence distributes pas- 
sions and instincts to all created beings in the various 
globes. The theory of the third would give an account 
of the laws according to which the Author of things dis- 
tributes to substances property, forms, colors, and savors: 
Finally, the theory of the material movement, a veritable 
new cosmogony, was to make known the laws of gravita- 
tion according to the ideas of the author. It is not easy 
to divine at the first glance in what applications that pre- 
tentious display of theories might end. This was the 
first error of Fourier, and he committed the still greater 
one of persisting in it. He transformed the flights of his 
imagination into geometrical theorems, of which he alone 
could give the demonstration, and upon which he ad- 
mitted no controversy. One must believe or be excom- 
municated. Fourier recoiled before no celebrity, before 
no name. Philosophers were the shame of the world. 



FOURIER'S PLAN OF ASSOCIATION. 51I 

The world had been going astray for five thousand years. 
The science, morals, politics of all the ages were only a 
tissue of extravagances and absurdities. 

Fourier lived thus several years, a prey to that devour- 
ing fever of hatred and disparagement of the past, which 
he retained to his last moments. His style, more strange 
than that of the Saint-Simonians, seemed a defiance of 
the French language : it was full of odd locutions and 
terms truly cabalistic. However, his dominant thought 
succeeded in finding its way through these obscurities. 
Fourier wished to make association prevail instead of 
separate interests, and to organize the isolated forces by 
means of what he called the iinpassioned attraction. His 
aim was to associate men, as he himself said, as capital, 
labor and talent. To attain it, he combined the efforts of 
agriculturists, shortened the hours of labor, distributed 
the ages and functions by series, and transformed the toil 
of the various occupations into a perpetual recreation, sea- 
soned with agreeable pleasures and sensations. It is not 
easy, even since his disciples have divested his theories 
of the critical digressions under which they were smoth- 
ered, to clearly distinguish what the author meant: it is 
much more easy to comprehend what he did not mean. 
He hoped, however, to find an opportunity to carry into 
execution some of his ideas, when he issued his Treatise 
on Agriculttiral Domestic Associatio7i, where are developed 
on an immense scale the unitary impassioned series which 
he had substituted for the present isolation of workers. 
In the place of our sad villages so scattered about, so 
squalid, so badly built, Fourier imagined in each locality 
a vast construction called a phalanstery, inhabited by the 
associated phalanxes of workers of every kind. An im- 
passioned attraction, a desire for well-being, could not fail 
to make these associations (which he would have consist 
of eighteen hundred persons) comprehend the advantages 
of the new life upon which they were entering. No more 
huts, no more sheds ; but a simple and commodious edi- 



512 HISTORY OF POLITICAL ECONOMY. 

fice, surmounted by a tower provided with its telegraph 
and ornamented with a clock. All the communications 
were to be made under shelter, in street galleries venti- 
lated in summer and warmed in winter. Every family 
could be lodged according to its fortune and live accord- 
ingly. It was not the regime of a convent, nor the dis- 
cipline of barracks; but an association in which each 
member would have his share in the advantage of one 
•cellar substituted for three hundred cellars, one garret 
for three hundred garrets, and one kitchen for three or 
four hundred kitchens. 

Thus far the conception of Fourier much resembles 
what we see in colleges, manufactories, places where 
many combine together, and where the common life pro- 
duces incontestable economies and advantages of various 
kinds. But on what would the inhabitants of a phalan- 
stery, rich or poor, live ? Fourier was not arrested by 
that difificulty. Each land-owner was to receive in ex- 
change for his land, transferable shares, which represent- 
ed its value ; and then down fell walls, living hedges, 
and fences, which separated their inheritances. The sepa- 
rate possession of property disappeared before that syn- 
thesis. Five hundred portions were transformed into 
one single domain ; there was no more labor on a small 
scale, no more Irish agriculture. In the interior, vast 
workshops succeeded the cold and dusty barns of our 
hamlets. The task of each was simplified by a division 
of labor, no longer absolute and permanent like that of 
the economists, but light, agreeable and varied like the 
relaxations of the great lords or like an exercise benefi- 
cial to the health. In agriculture and in manufactures, 
each followed his inclination, and, as the workers con- 
stantly lived in each other's presence, rivals in perfection, 
quickness and devotion, the results of their Avork would 
naturally and necessarily surpass all the products of con- 
tinual and forced labor. The phalansterian association 
thus gave advantages much greater than all the superan- 



THE PHALANSTERY. 513 

nuated modes of selfish working; the only question was 
that of making an equitable distribution of them. Here 
the author seems to us to have carried the spirit of asso- 
ciation too far. He supposes that the capitalists of the 
phalanstery, whose interest it is to consider their work- 
men, without whom capital would be unproductive, would 
give them a reasonable portion, and that the workmen, 
convinced of the impossibility of working without capi- 
tal, would in their turn consider the capitalists in the 
distribution of profits. There will then be one portion 
for capital, one for labor, and one for talent. But how 
estimate labor and talent? According to their utility ; 
for Fourier gives useful arts the preference over the 
agreeable arts. He recognizes labors of necessity, of 
simple utility, and of pleasure. The first will be recom- 
pensed most highly, as being generally the hardest ; the 
agreeable labors will find a part of their recompense in 
their very agreeableness. Common workmen will be bet- 
ter paid than artists. Fourier thought thus to raise the 
poor classes from the wretched state into which they had 
fallen, and he imagined that thus he would make the 
causes of hatred or envy which, from the foundation of 
the world, have separated them from the rich classes, dis- 
appear. There would no longer be any poor. The least 
portion of repulsive work would lead to high wages, and 
universal harmony would not be long in becoming estab- 
lished between classes which have too long been hostile. 
The great man, in the fine arts, in science, in manufac- 
tures, would be the elect of all the phalanxes, the one 
pensioned by all the workers. No more law-suits, no 
more hospitals, no more prisons, no more ingratitude or 
social rigors ! 

I forgot to say, also, no more armies ! No more wars ! 
or rather what armies ! what wars ! Armies of elect work- 
ers, advancing to the execution of the most gigantic la- 
bors on the face of the globe, some cutting the isthmus 
of Suez, others the isthmus of Panama ; these deepening 



514 HISTORY OF POLITICAL ECONOMY. 

the bed of rivers, those connecting lakes, drying up 
marshes, or exhausting mines. We have seen what the 
villages would be : judge what must be the cities. The 
sympathies which unite the phalanxes, will direct the re- 
lations of a higher order which will be established be- 
tween the cities, and when their industrial forces are not 
sufificient, the armies will commence their march, no 
longer then to destroy and plunder as to-day, but to 
build up and to embellish. In the political order, univer- 
sal election, absolute liberty, complete equality, in a 
word, absence of government. Of what use to think of 
tempests, when all the winds are suppressed, except the 
zephyrs ! The author might from the same point of view 
proclaim perpetual spring. 

One cannot, however, speak with irony of the dreams 
of Fourier. A man who devotes his entire life to the 
worship of such an idea, who aims to make the passions 
cooperate for the good of humanity, who undertakes to 
associate families and interests, and who works with such 
energy for the abolition of social miseries, is not a vulgar 
utopist, though all his projects are of a Utopian nature. 
An Utopia is often only an advanced opinion proclaimed 
in the presence of a generation who do not yet compre- 
hend it, and destined to become a commonplace for the 
generation which follows. Fourier has laid the founda- 
tion of a theory which is beginning to bear its fruit ; for 
the very men even who have not studied it, regard it by 
a sort of instinct, in associating themselves in material 
and moral interests under all sorts of forms. The socie- 
tary school would have made many more proselytes still, 
if Fourier had not affected such a profound disdain for 
all the writers in the world, by failing in the first duty of 
every man of sense, respect for ancestors. One has an- 
cestors in science as in nature, and it is an evidence of 
bad taste or of bad principles to manifest contempt for 
them. The work of these ancestors, however defective 
it may have been, cannot be undone in a day, and it was 



FOURIER»S ERROR. HIS DISAPPOINTMENT. 515 

the error of Fourier to imagine that he could succeed in 
doing it, all at once, in spite of institutions, habits, and 
prejudices. However, he turned, especially in the latter 
part of his career, toward childhood, as more fitted to re- 
ceive the impress of his doctrines. What he says on the 
subject of children is of admirable correctness, freshness 
and delicacy. He rightly attaches an infinite value to 
their education, and although the system he proposes 
does not seem to us conformable with nature, since its 
first result would be to take away sons from their fathers 
to bring them all up in common, we nevertheless ac- 
knowledge that it contains the most ingenious views ever 
published on this difificult subject. 

It would be rash to predict the near results of the 
societary theory of Fourier. We have not yet seen this 
system in operation ; no phalansterian establishment has 
been permitted to carry out any decisive experiment on 
this subject. Nothing would have a better claim to our 
interest than an exact analysis of the social revenue of 
one of these model establishments, whose foundation we 
regret the government itself has not encouraged. What 
a check to innovaters, if, under such patronage, a serious 
experiment should fail; but also what a shaft of light, if 
it should succeed! Fourier died, heart-broken at not 
having been able to attain that favor from his contem- 
poraries : and, in his despair, he accused the economists 
of having prevented, as far as lay in their power, the 
carrying out of his idea. What could they gain by pre- 
venting an attempt of such importance ? The accusation 
then falls of itself, and the cause of the evil is attribu- 
table to the author of the system, to whom it was not 
given to make a capital attempt, because the circum- 
stances or his powers never permitted him to decide 
upon it. His book will remain as the boldest critical 
work which has ever been published against modern 
political economy: but it has been no more fortunate 
than the latter in the discovery of solutions to social 



5l6 HISTORY OF POLITICAL ECONOMY. 

questions. This is because such solutions are daughters 
of time, and appear only at long intervals, adapted for a 
moment, perhaps, to the essentially transitory wants of 
humanity, and changing like them. 

Mr. Owen, in England, set about the investigation of 
the same problem as Fourier, without being more for- 
tunate. Their doctrines, which have often been con- 
founded, resemble each other in only a few points. The 
cooperative societies of the English socialist had scarcely 
anything in common with the phalanxes of the French 
associationist. It was not by economic reforms that Mr. 
Owen attempted to ameliorate the condition of the work- 
ingmen, but rather by good administration and moral- 
ization employed with intelligence and firmness. The 
establishment of New Lanark, improperly considered as 
a social attempt, was only a great manufactory invaded 
by drunkenness, debauchery, and lack of discipline, when 
Mr. Owen applied to it his principle of regeneration and 
of a somewhat puritan rigidity. He made strict rules, 
inflicted fines, settled little difUculties amicably, and at- 
tained satisfactory results both as to products and order, 
as an active and judicious manufacturer might have ob- 
tained them. At the same time, the dwellings of the 
workmen became cleaner; stores were opened for the 
sale of articles of consumption at the lowest possible 
prices and of the best quality. The system of Mr. Owen, 
applied for sixteen years to the population of New 
Lanark, composed of more than two thousand souls, ob- 
tained a brilliant reputation for this philanthropist, and 
numerous visitors to his manufactory: but he ventured 
no absolute idea, for fear of wounding the umbrageous 
susceptibilities of his fellow citizens, and it was in France 
alone that I heard him speak stern truths of the English 
aristocracy. 

Mr. Owen nevertheless rashly admitted the abolition 
of property. He wished to suppress all social inequalities, 
and he demanded at the same time the closing of dram' 



OWEN'S SOCIALIST EXPERIMENTS. 51/ 

shops, reform in instruction, reform of the church, and of 
all abuses. His teaching therefore was somewhat de- 
clamatory and vague, and his prescriptions resemble too 
much the commands of a preacher. So long as he was 
present at New-Lanark, in the manufactory where his ex- 
periments were made, order reigned there, labor was pro- 
ductive and discipline was maintained ; but after his de- 
parture, every one took up again his accustomed way and 
the system disappeared. Mr. Owen having hoped that 
attempts would succeed better on virgin soil, went to 
America and founded his famous establishment of New 
Harmony. He took with him many proselytes of both 
sexes, and the location of his domain seemed happily 
chosen. However, in a shqrt time, human passions had 
resumed their sway ; he found in that regenerated society, 
as in ours, cowards, the jealous, the idle, and the intem- 
perate, and the serenity of the founder was once more dis- 
turbed. A journey which he was obliged to make to 
Scotland, completed the ruin of his establishment, in which 
anarchy reigned, and which was sold to a German illumi- 
nate, named Rapp. Miss Martineau, who visited that 
society in 1835, reports that the remains of the Owenist 
colony resembled a community of Moravian brothers, and 
that the new chief had succeeded in keeping them together 
only by isolating them from all foreign contact, in the 
manner of the dictator Francia, in Paraguay. 

Notwithstanding these serious checks, the popularity 
of Mr. Owen had only increased. Several editions of his 
theories, more fortunate than his practice, had been 
quickly exhausted, and people talked everywhere only 
of the great things promised by the new English reformer. 
It was at the period of the philosophic reaction, excited 
in France by the attempts of the Jesuits, and in England 
by the discussion of the bill for Catholic Emancipation. 
Mr. Owen issued a violent manifesto against all religions, 
accusing them of all the evils of the human race ; and, 
strange to say, this bold publication, extended to thirty 



5l8 HISTORY OF POLITICAL ECONOMY. 

thousand copies and circulated through all the journals, 
caused him to lose none of the good will of several sov- 
ereigns who had become interested in his experiments. 
The Duke of Kent, brother of the king of England, one 
of his warmest admirers, consented even to preside over 
a public assembly where the latter were to be explained. 
Mr. Owen was a firm supporter of order ; it was in vain for 
him to point out social imperfections, and the disquiet- 
ing contrast of great riches and poverty : every one 
knew that he wished to arrive at his ends by a strict dis- 
cipline to which he would have wealth itself subjected; 
and this sort of reform could not be looked upon unfavor- 
ably by absolute governments. 

The economic views of Mr. Owen were summed up in 
a most complete manner in a memorial which he addressed 
to the representatives of the allied powers, assembled at 
the congress of Aix-la-Chapelle. He there concisely set 
forth the immense increase in the mechanical powers of 
production, and he declared that these powers were more 
than sufficient to satisfy very liberally all the wants of the 
population of the globe. He forcibly described the dis- 
astrous consequences of the absence of all order in the 
production and distribution of wealth, and the necessity 
of substituting for competition unity of interest : he de- 
monstrated, in fine, how a superabundance of products, 
by depriving the working classes of labor, plunged them 
into frightful poverty in the midst of abundance ; and how 
urgent it had become to remedy these evils, by organizing 
things so as to aid manual labor by mechanical labor, in- 
stead of substituting the latter for the former and leaving 
the laboring classes without any security for their subsist- 
ence.* Mr. Owen had proposed, at various times, sub- 
scriptions for the purpose of founding agricultural and 
manufacturing settlements, based on unity of production 
and consumption ; but parliament, when consulted, gave 

* See a series of remarkable articles on Owen, in the Journal de la Science 
Sociale, by M, B, Dulary, 



ASSOCIATION MUST BEGIN AT SCHOOL. 519 

no furtherance to these projects. It is supposed that such 
was the origin of the agricultural colonies established at 
Frederick's Oord in Holland, which did not, however, pro- 
duce results as satisfactory as had been hoped. Neverthe- 
less, the indefatigable reformer was not discouraged ; and 
after a series of vicissitudes which prove, at least, the ex- 
treme difficulty of these social improvisations, after hav- 
ing traveled over Europe to set forth his plans, Mr. 
Owen lately returned to France, a little discouraged with 
men and resolved, like the dying Fourier, to devote him- 
self to children. 

It is through childhood especially that it is possible to 
arrive at a serious reform of the present economic order. 
So long as the children of an industrial community shall 
be brought up at hazard, almost all for liberal profes- 
sions whose number is restricted, there will be an insuffi- 
ciency of capable persons in many occupations and a 
redundancy in many others. After having tried all sys- 
tems, after having criticised governments, institutions, 
methods, people and kings, one is evidently brought to a 
recognition that it is intelligence which is lacking to re- 
sources, and not resources to intelligence. Three-fourths 
of the living forces of society are languishing in a deplo 
rable atony, and there are still more unproductive men 
than sterile lands. Governments cannot, doubtless, se- 
cure to all citizens an agreeable and gentle life ; but it 
would be less difficult than is supposed, to facilitate the 
means of their procuring it for themselves. The personal 
value of men, in all occupations, seems to us capable of 
indefinite increase, by an education which will allow 
childhood to lose nothing in the development of its fac- 
ulties. Fourier and Owen are in accord on this point, 
and one may consider as a discovery even the exaggera- 
tions of their confidence in that regard. The great asso- 
ciation must begin at school and be followed up outside. 
Is it not, in fact, at school that the real superiority of in- 
telligence and labor dominate, notwithstanding the abso. 



520 HISTORY OF POLITICAL ECONOMY. 

lute equality which governs all relations . If people should 
bestow on the education of children the solicitude that is 
expended on the government of men, it would suffice in 
a few years to change the face of economic questions. 
By increasing the moral capital of nations, their resources 
would be increased, and the catastrophes by which they 
are afflicted would be prevented. There are many sani- 
tary regulations to prevent physical contagion : why 
should there be none to prevent the moral contagion of 
ignorance, idleness, and incapacity ? You complain of 
the encroachments of the poverty which knocks at your 
doors and encumbers your hospitals and your prisons ; 
but what are you doing with your children ? What 
wealth, pray, do you expect to see created by those myr- 
iads of neglected creatures swarming in the mud of your 
cities and your villages, or ruined in the impure atmosphere 
of your manufactories? Respect the utopists who blame 
your heedlessness, and regret their errors, for they are 
consuming their lives in thinking for millions of in- 
grates ! 



CHAPTER XLV. 

General view of systems of political economy. — National characteristics o! 
the various schools, — Italian school. — Spanish school. — French school. — 
English school. — German school. 

We are approaching the termination of our course. 
We have rapidly gone over the history of the experiments 
which have been made among civilized people to amel- 
iorate the physical and moral condition of man. Greece, 
Rome, the middle ages and modern times, have in suc- 
cession passed before us, and everywhere the same prob- 
lem has been presented ; everywhere the struggle between 
the slave and the master, the rich and the poor, the em- 
ployer and the workman. This struggle, which still lasts 
under new forms, has given birth to all the systems of 
political economy which have succeeded each other, from 
the Economics of Xenophon, who proposed to brand 
slaves on the forehead to prevent them from escaping, to 
the societary theory of Fourier and the co-operative com-, 
panics of Owen. The mind is confounded at the similar- 
ity of tone in these social experiments, which always meet 
with obstacles and yet constantly recur, to die and to 
be born again from generation to generation. At both 
extremities of the Christian era, and at the ends of 
the earth, in old Rome and in the United States, we 
always find slavery such as it was when continued by the 
Barbarians and kept up by the feudal system ; and we 
might think that humanity had remained stationary, to 
see the extreme slowness of its conquests and its heed- 

521 



522 HISTORY OF POLITICAL ECONOMY. 

lessness in preserving them. However, social progress 
has never been arrested since ancient times, although it 
may appear to us confused and irregular at certain epochs. 
The advent of Christianity, the invasion of the Barba- 
rians, the crusades, persecutions of the Jews even, the es- 
tablishment of the Hanse towns, the affranchisement of 
the communes, the organization of corporations by Saint 
Louis, the industrial and commercial movement of the 
Italian republics, protestantism, and the discovery of 
America, have brought gradual changes in the course of 
political economy. Experiments have not discontinued 
theories, but have always preceded them. We have 
seen these laborious developments of science in facts ; it 
is time to sum them up in systems. 

These various systems have always borrowed some- 
thing from the character of the nations among which 
they have taken rise. Italy, which had the honor of 
lighting the torch of all the sciences, was the first to de- 
vote herself to the study of political economy. While 
most of the great states of Europe were a prey to finan- 
cial expedients and to poverty, banks were established 
at Venice, Milan and Genoa ; the first budgets of public 
expenses and receipts were being prepared at Florence; 
a silk and wool nobility was being substituted for the 
nobility of the sword. Excellent writings on money re- 
vealed the secrets of credit and created the science of 
finance. There was nothing, even in the misfortunes of 
the Peninsula, which did not favor the progress of politi- 
cal economy, by making the Italians experience, under 
Charles V, the disastrous influence of monopolies, high 
taxes and prohibitions. In 1582, Gaspard Scaruffi pub- 
lished his work On Moneys and the True Proportion between 
Gold and Silver. He proposed the creation of a universal 
inedium of circulation and the mark of all goldsmiths' 
work. The Neapolitan Serra, who wrote in 161 3 his 
Treatise on the Causes which make Gold and Silver abound 
in Kingdoms^ comprehended the productive power of 



ITALIAN ECONOMISTS. GENOVESI. 523 

manufactures. Bandini, the precursor of Quesnay and 
of the Physiocrates, pointed out the advantages of one 
single tax, as more easy and more economical ; Broggia 
published the first methodical writing on the theory of 
taxation. But the most celebrated of the Italian econo- 
mists is unquestionably the professor Genovesi, who may 
be justly considered the rival of Adam Smith, if not in 
correctness of doctrine, at least in the impulse he gave 
to the teaching of the science in all Italy. 

No writer, in fact, represents more exactly the char- 
acter of the Italian economic school. That school has 
been at all times philosophic and reformatory ; it takes 
pleasure in the chances of politics and its counsels are 
less frequently addressed to the people than to kings. 
Genovesi had the courage to keep it in that perilous and 
honorable line. He contended for free trade in grain, 
for the abolition of laws on the interest of money and 
for the reduction of the number of religious communities. 
He proclaimed the superiority of labor over the pro- 
ductiveness of mines, to enrich nations. He clearly fore- 
saw, in 1764, the independence of the United States of 
America and the ruin of the colonial system. His high 
morality, his eloquence, and his vast erudition constantly 
attracted to him a multitude of disciples, and although 
his doctrines favored the mercantile system, he may be 
considered the founder of political economy in Italy. 
Algarotti, one of his most celebrated successors, has given 
us the first analysis of the phenomena of the division of 
labor, of which the Marquis of Beccaria was to complete 
the theory almost at the very time when it received, in 
England, the fine demonstrations of Adam Smith. Bec- 
caria, in his picturesque language, called iron the father- 
metal. He was a follower of the French Economists of 
the school of Quesnay. 

The Meditations on Political Economy, by Count Verri, 
contributed not less to the success of the Italian school. 
Verri was the precursor of Adam Smith. His concise 



524 HISTORY OF POLITICAL ECONOMY. 

and energetic style, and his ingenious and striking com- 
parisons have given much popularity to his works, de- 
spite the important deficiencies one finds in them. Vasco 
and Ricci, who wrote on poverty and on benevolent in- 
stitutions, represent in Italy the theories of Godwin and 
of Malthus. The former maintained that governments 
should help the poor; the latter established the inutil- 
ity and danger of all systematic and compulsory aid. 
We find in Vasco the Saint-Simonian idea of the aboli- 
tion of inheritance. Ortes, his contemporary, has been 
too much lauded ; but this author has the merit of being 
the first one in Italy to point out the encroachments of 
pauperism and the means of remedying it. He has well 
shown the contrast between wretchedness and opulence 
in the large cities. According to him, " Population is 
maintained, increases or diminishes always in proportion 
to the wealth ; but it never precedes wealth. The gen- 
erations of brutes are limited by the action of man ; the 
generations of men are limited by reason. Population 
diminishes from excessive taxation and slavery. Celibacy 
is as necessary as marriage to preserve the population. 
To reproach a celibate for celibacy would be the same 
thing as to reproach a married man for marriage. Work- 
houses provide for a few and fail to provide for a greater 
number." 

Filangieri was one of the most able defenders in Italy 
of freedom of trade, and the constant enemy of the numer- 
ous standing armies. '' So long as the evils of humanity 
are not cured," he exclaimed, " so long as the errors and 
prejudices which perpetuate these evils find advocates; 
so long as truth, known only to a few privileged men, 
remains hidden from the greater part of the human race ; 
so long as it manifests itself far from thrones, the duty of 
the economic philosopher is to preach it, to maintain it, 
to promote it, and to illustrate it. If the information he 
gives is not useful to his age, to his country, it will 
certainly be to some other age, to some other state. A 



CHARACTER OF THE ITALIAN SCHOOL. 525 

citizen of all countries, a contemporary of all ages, the 
universe is his country, the earth is his pulpit, his contem- 
poraries and his descendants are his disciples." Never, 
perhaps, was the cosmopolitan expression of the Italian 
school more manifest than in this author, unless it were 
in the numerous writings of Melchiorre Gioja, the Atlas of 
the science in Italy. His famous Prospectus of the Economic 
Sciences had for its aim to reduce to a system all that 
writers have thought, governments sanctioned and people 
practiced, in public and private economy. In it, the 
opinions of all Italian and all foreign writers are exam- 
ined. It is a real encyclopaedia of the sciences ; but it is 
not always impartial, especially in regard to the French. 
The distinctive characteristic of the economic school 
of the Italians consists principally in their broad and com*- 
plex manner of looking at questions. They do not concern 
themselves with wealth from an abstract and positive 
point of view, but in its relation to the general welfare. 
For an economic measure to appear important to them, 
there must be connected with it not only some money 
question, but some moral or political interest. Business 
partnerships are not in their eyes banking-houses and the 
workmen machines. They consider man as the perpetual 
object of their solicitude and study. They are publi- 
cists as much as economists. Montesquieu best repre- 
sents in our language the true type of the economist in 
theirs. The questions in which they have excelled are 
those of moneys, free ports, agriculture, loan-banks, and 
benevolent institutions. If their numerous works have 
not obtained a great reputation, it must be attributed to 
the umbrageous precautions of almost all governments 
and the personal position of the authors, some of whom 
were ministers, others counsellors, and some few ecclesi- 
astics ; but political economy owes to them its propa- 
gation in Europe and excellent treatises on a great num- 
ber of important subjects. Most of these economists had 
to brave the inquisition of Rome, that of Venice, con- 



526 HISTORY OF POLITICAL ECONOMY. 

temporary prejudices and the despotism of their govern- 
ments. They wrote against existing abuses, and, as it 
were, in the breach. Their life was a combat, and politi- 
cal economy meant with them social science, the univer- 
sal science ; everywhere else it was only the science of 
wealth. 

In Spain, it was always considered an ally of the 
treasury. All the economic legislation of that country is 
stamped with an exclusive character which traces back to 
the expulsion of the Moors, and the discovery of the 
New World. Industrial freedom early succumbed there 
before the establishment of manufactures by seignorial 
or royal monopoly ; and the supposed necessity of secur- 
ing to Spain the American market, gave rise there to the 
prohibitory system which has since infected all Europe. 
All the economic pests proceed from that source. By 
pursuing with the utmost hostility the Moors and the 
Jews, the Spanish destroyed the spirit of enterprise and 
speculation in the Peninsula ; by multiplying convents 
and monks, they gave a premium to indolence and raised 
beggary to the rank of a trade. The majorats, mort- 
main, and hatred to foreigners were equally prejudicial 
to agriculture, manufactures and commerce. There is 
perhaps no country in the world where the economic 
administration has caused more evils, and one might say 
that Spain had tried on herself all bad systems, as certain 
experimenters try poisons. What useful thing could be 
attempted under threat of the tortures. of the inquisition, 
and in view of the American mines, whose inexhaustible 
products seemed suddenly produced expressly to repair 
all errors, to produce an illusion as to all dangers? 
That prosperity was as fatal to Spain as the greatest mis- 
fortunes. It lulled her into a disastrous sense of security, 
it made her believe that the power of states resided 
in the precious metals and not in labor ; it engendered 
the absurd prejudices of the balance of trade and the dra- 
conic laws against the exportation of money ; it covered 



SPANISH ECONOMISTS. 52/ 

with flowers the edge of the precipice over which that 
monarchy was one day to be plunged. 

It is in the writings published under the influence of 
these deplorable prejudices that we must seek the ex- 
planation of the decline of Spain and of the progress of 
bad economic doctrines in that country. Almost all 
these treatises having been prepared by priests or by 
those in the employ of the treasury, are virtual mani- 
festoes against the fundamental principles of tiie wealth 
of nations. Oppression within, exclusion without, such 
is their motto. One would suppose, on reading them, that 
the human race had been created for the good pleasure 
of a few families and a few corporations. However, to- 
wards the end of the eighteenth century, the philosoph- 
ical movement, originating in France, penetrated into 
Spain, and produced there, in the reign of Charles III, a 
reaction favorable to political economy. Commissioners 
were appointed to explore the American possessions ; 
canals were made and roads opened in the mother coun- 
try, and the bank of Saint Charles seemed to desire to 
initiate the Spaniards into the advantages of credit. At 
the same time, Cabarrus, Jovellanos, Danvila, Martinez 
de la Mata, Sempare y Guarinos, and, in our time, Valle 
Santoro, Florez Estrada, and several distinguished mem- 
bers of the Cortes, attempted to call back the nation to 
the too long uncomprehended principles of political 
economy. 

But all these efforts were futile against the stubborn- 
ness of national prejudice and the misfortunes with which 
Spain had been overwhelmed since the beginning of the 
nineteenth century. The system of prohibition made 
her lose her finest colonies ; industrial monopolies de- 
stroyed all her manufactures ; the tithe and the majorats 
struck her agriculture with sterility ; war scattered what 
capital she had left, and anarchy still paralyzes the efforts 
she makes to resume her rank among nations. Never 
did a people present a more striking example of the 



528 HISTORY OF POLITICAL ECONOMY. 

chastisements which follow errors in political economy, 
and never did the citizens of any country expiate in a 
more' cruel manner the faults of their government. There 
is not one single social pest of that monarchy which is 
not the result of a bad doctrine, and one may say that 
she has served as an example to all others by teaching 
them to profit by her mistakes. The Spanish economic 
school is in fact the one which has spread abroad in the 
world the most commercial prejudices, and Spain is the 
country which has suffered the most from them. Her 
political economy is still the same as that of Charles V, 
and the eloquent protests of Jovellanos and Florez 
Estrada have not succeeded in making any impression 
upon it. 

Political economy had in France a happier fate. Not 
a century has passed without generous voices being 
raised for the triumph of the eternal principles of justice 
in the distribution of the profits of labor. In the reign 
of Saint Louis the corporations secured to each trade- 
body, if not to each worker, a certain independence ; the 
workman was subjected to a severe discipline, but the 
corporation, at least, was free. Under Henry IV, agri- 
culture had its turn, and the peasants, freed from a mul- 
titude of vexations, came forth for the first time from 
the state of torpor in which the feudal system had 
plunged them. We see, in reading the writings of Sully, 
that this great minister worked in a systematic manner 
to emancipate agriculture, and that this important branch 
of production occupied in his mind the rank which is its 
due. Colbert organized the industries on new bases ; ^ he 
gave them encouragement and laws ; and we have shown 
that he was less hostile than is generally supposed to the 
agricultural interests. Then came the period of Law, 
the foundation of credit and its stormy times, those dis- 
tressing experiences which had at least the advantage 
of making France acquainted with one of the prin- 

* See chap, xxvii of this history. 



ENGLISH ECONOMY INDUSTRIAL. 529 

cipal elements of her future wealth. The Economists 
of the eighteenth century completed the work of the 
preceding centuries, by propounding the first economic 
theory which served as an introduction to the science. 
This was as a signal given to Europe ; and from that mo- 
ment, human thought seemed to take no respite. Every- 
one comprehended that social science concerned' the 
most humble citizens as much as the most august heads. 
Society wished to become acquainted with itself ; it 
studied the phenomena of its own functions, and thus it 
was that from experiment to experiment, even at the 
cost of misfortunes, France has attained the point of 
stating the problem of the future, with her accustomed 
clearness, to all peoples and to all governments. Politi- 
cal economy was philosophic in Italy and fiscal in Spain ; 
in France alone has it assumed an organizing and social 
character. 

England has given it a physiognomy and a tendency 
exclusively industrial. Political economy is considered 
in that country only as the science of wealth. English 
writers have studied wealth in an abstract manner and 
independently of the evils which too often accompany 
its production. They have been justly reproached with 
having considered questions of manufactures and ma- 
chines as too separate from the welfare of the laborers, 
and of having manifested an insensibility to the suffer- 
ings of the working classes. Most of the modern writers 
of that school, renouncing the attractions of style so 
potent for the triumph of even their doctrines, have 
treated political economy like algebra, and have ventured 
to maintain that all the propositions of the science could 
be demonstrated with mathematical certainty. This ten- 
dency has not led them to the most philanthropic solu- 
tions, but it has permitted them to follow out the con- 
sequences of their principles with inflexible logic. They 
have thus succeeded in giving to economic language a 
precision which has contributed much to the progress of 



530 HISTORY OF POLITICAL ECONOMY. 

ideas. It is the English who have best defined the words 
production, capital, competition, credit, and a host of others 
not less important. They have created a nomenclature, 
which has finally been adopted by all the economists of 
Europe, and which will serve as a starting point for their 
future labors. 

We have shown the radical fault of this severe and 
positive school and the danger of the complications to 
which its doctrines have given rise. By sacrificing all 
social considerations to the desire of creating wealth, the 
English have developed beyond measure the productive 
power of the nation, but they have not added propor- 
tionately to the well-being of the workers : happy the 
latter, when commercial crises have not made them vic- 
tims of competition or of a fall in wages ! The time 
has not yet come to affirm how far this system of in- 
citing to consumption has been able to contribute to the 
development of production, by multiplying with wants 
an ardor in working which will permit their satisfac- 
tion. The continual increase in taxes, principally on 
objects of consumption, has condemned the inhabitants 
of that country to a perpetual fever of improvements. 
England has become an immense manufacturing establish^ 
ment, a universal counting-house. Seated on a double 
couch of coal and iron, open to foreign commerce by 
more than a hundred excellent ports, she has found in 
her midst men of genius who have furrowed her soil 
with canals and roads ; who were the first to make com- 
mon, if not to invent, the steam-engine ; who have en- 
dowed their country with the spinning-frame and with 
railroads. She has founded her credit on a basis so broad 
that the national fortune is increased by it as by a metal- 
lic conquest ; she has scattered instruction with so liberal 
a hand, that no aptitude would run the risk of remaining 
sterile there. To complete her good fortune, this empire 
has found in most of her ministers superior intelligence, 
which has been put to the service of science and has 



GERMAN ECONOMY ADMINISTRATIVE. 53 1 

executed with rare ability its most difficult prescriptions. 
Besides, England has become the classic land of economic 
experiments, and it is from this great laboratory that 
they to-day come forth to the world. 

The German economists have considered the science 
from a philosophic and political point of view which dis- 
tinguishes them wholly from other European writers. 
In their view, political economy comes near being the 
science of administration, the science of the state, the 
union of the caineral sciences, as they call it. They 
almost always incliade in it diplomacy, constitutional law, 
statistics, and even the regulation of the state, a strange 
combination in which the best minds could not have 
helped being lost, if the very difficulty of the subject had 
not imposed upon them a salutary restriction. Among 
them may be counted many believers in the system of 
Quesnay, particularly Mr. Schmalz, who has published 
in these latter years a treatise that one might suppose 
destined to revive the doctrines of the PJiysiocrates. The 
professors Rau, of Heidelberg, and Poelitz, of Leipzig, 
have set forth in a most complete manner the principles 
of political economy as they are understood in Germany ; 
not that Germany has claimed to have its particular sci- 
ence and more perfect processes in the production and 
distribution of wealth, but that in this country political 
economy has always been considered in its relations to 
public law and administration. Several writers have even 
had an idea of giving it a theological basis ; and it no- 
where presents itself with a more numerous train of de- 
velopments and applications. The Count of Soden, who 
calls it the science of the economy of the state {Staats- 
Haushaltungs Kunde) divides it into theory, legislation, and 
administration. Finance, public order, and education 
occupy in it an extended place. 

The tendency of German political economy to encroach 
upon the domain of the publicist, has become almost 
general in Europe. J. B. Say, in his Complete Course., 



532 HISTORY OF POLITICAL ECONOMY. 

had already allowed himself a great number of digres- 
sions on public consumption, works carried on by the 
state, the instruction of youth and the expenses of a fleet 
and army. The progress of general wealth had demon- 
strated to him the utility and even the necessity of the 
intervention of the government in great enterprises of 
public utility. He relaxed by degrees the rigor of the 
exclusive principles which had so long made him reject 
that powerful intervention. England, on her side, enter- 
ing for the first time the career of parliamentary investi- 
gations, brought new light to political economy, and 
proved in the most incontestable manner how many ser- 
vices can be expected from the influence of governments 
on production. Germany, however, has remained faith- 
ful to her metaphysical habits ; and we know nothing 
more opposed than the writings of her greatest econo- 
mists to the perspicuity of the French writers, and the 
severe and didactic forms of the English economists. 

The development of the industrial arts and of com- 
merce in Germany has however begun, within a few 
years, to modify the too speculative tendency of eco- 
nomic science in that country. Mr. Krause, to whom 
his fellow countrymen owe a remarkable work on Prus- 
sian custom-duties, has come down from the regions^of 
metaphysics to the solid land of applications, and he has 
presented views of great interest to agriculture, notably 
a matured plan of a territorial bank, which seems to us 
worthy of consideration. Mr. Zacharise, Professor Her- 
man, Mr. Malchus, Mr. de Nebenius and Mr. Buchholz, 
have entered more and more into the way of practical re. 
forms, and we cannot help recognizing that Germany 
continues to make decided and intelligent progress in 
them. The tariff association, organized by Prussia, is 
the most vast and bold economic reform which has been 
carried into execution for a century. The eminently 
electic spirit of the 'Germans early shielded them from 
any infatuation for systems, and they had the good for- 



TENDENCIES OF POLITICAL ECONOMY. 533 

tune to profit by the experiences of their neighbors, with- 
out adopting their prejudices. As they had always kept 
equally removed from the exclusive regime of the Span- 
ish, the manufacturing system of the English, and the 
anti-commercial violence of the French revolution, a re- 
form could be wrought among them without overthrow- 
ing the factitious capital which to-day throws so many 
obstacles in the way of improvements in other countries. 
Less absolute, the Germans are less embarrassed in their 
movements : they have no victims to make, no interests 
to sacrifice ; reform has had full scope as on a virgin soil ; 
and perhaps, while discussion continues in the states re- 
nowned for their practical habits, it is in the country of 
metaphysics that the most decisive attempts will be 
made. 

Whatever may be the characteristic differences which 
to-day distinguish the systems of political economy in 
Europe, they all are coming gradually to coincide in one 
common opinion, the necessity of a more equitable dis- 
tribution of the profits of labor. Even in the country 
where the press and the tribune are mute, a prophetic 
instinct warns the governing powers of the true needs of 
the people, and imposes on them the obligation of satis- 
fying them. The energy formerly expended in works of 
war, is now directed to industrial enterprises ; the condi- 
tion of the workman is honored, and we are rapidly ad- 
vancing towards the achievement of a new compact, 
either between the workmen, or between nations. The 
individual aspires to his share of the collective power of 
the masses, and we no longer conceive of any other social 
state than that which secures to each a lot proportioned 
to his personal talents and his daily labor. Governments 
even are obliged to earn their living by the sweat of their 
brow, and to resolve difficulties that they could with im- 
punity elude a few years ago. A salutary emulation has 
become established between them in measures favorable 
to increase of the general welfare, and one would find 



534 HISTORY OF POLITICAL ECONOMY. 

it difficult to cite a single important administrative act 
which does not aim at progress in public wealth and the 
amelioration of the fate of the humblest citizens. How 
many results of this kind has not political economy pro- 
moted since the beginning of the nineteenth century ! 
Order has become reestablished in the finances and faith 
in public engagements has become a sacred thing ; sav- 
ings banks have offered protection to the savings of the 
poor ; benevolent associations and mutual aid societies 
have multiplied in all enlightened countries ; commerce 
has brought people together whom war had too often 
long separated. No economic school dares openly to ad 
vocate the exclusive system, and no one longer believes 
that any country can grow rich by the ruin of its neigh- 
bors. The respective beliefs of the old sects will soon 
be combined in a universal religion, in an industrial and 
pacific Catholicism which will sum up the great labors of 
the past to the advantage and satisfaction of the wants 
of the future. When a line of railroads shall unite Mar- 
seilles and Moscow, there will no longer be either German 
or French political economy, and the Prussian custom- 
duties will have ceased to exist. People will no longer 
discuss the matters which occupy so much of our thought 
to-day, except to regret that they should have deliberated 
so long instead of acting I 



CHAPTER XLVI. 

Economic complications resulting from industrial affranchisement since 
1789. — Disadvantages of competition. — Contradiction between facts and 
laws. — Necessity of harmonizing them. — Revolutions which have taken 
place in commercial relations since the nineteenth century. — Modifications 
of political economy resulting from them. 

The time has indeed come for action, for everything 
advances with rapid pace, and the movement which is 
bearing us on scarcely leaves us time to look about us. 
Nothing more remains of the ancient social state on 
which the institutions of our fathers were based ; a half 
century has sufficed to renew the face of the earth and 
the field of experiment. The restless condition of pres- 
ent society is especially due to the incompatibility be- 
tween the old systems and the new interests. The eco- 
nomic principles which govern us date back more than 
two hundred years, and our industrial constitution has no 
longer anything in common with that of the period when 
they originated. In whatever direction we turn our eyes, 
this contrast strikes us and presages a renovation. The 
examination that we are about to make of it will be the 
conclusion of this history, and will sum up its moral re- 
flections. 

The first blow was struck by the French Revolution. 
This abolished in a single night the right of primogeni- 
ture, entail, majorats, tithes, and privileges of every kind. 
For the old system of concentration of landed property, 
it substituted its extreme division, the excess of which 
brings again in question to-day its first benefits. It freed 

535 



536 HISTORY OF POLITICAL ECONOMY. 

labor by abolishing corporations, and gave new life to 
commerce by suppressing interior custom-duties. But we 
have since beheld growing up an unlimited competition, 
a multiplication of rural enterprises, with insufficient 
capital, and agriculture after the Irish mode. One single 
class was, before 1789, subject to the impost tax ; equal- 
ity before the law has subjected all the others to it. The 
distribution is doubtless more equitable ; but the burden 
has singularly increased. The destruction of warden- 
ships accorded freedom to the workmen, but it took away 
the responsibility of the masters. The Revolution gave 
much ; it demanded more. Thus, at the first steps, 
all the old social organization was profoundly modified, 
and the new institutions remained subject to the old 
customs or left to chance. In emancipating the men, 
the fetters had been left on their feet ; liberty was going 
to become more disastrous to them than servitude. In- 
stead of making war on their masters, they made it on 
each other. 

Every one knows the unforeseen complications which 
have arisen from this state of things. It was a fine spec- 
tacle, certainly, to see the lists open to all capacities ; but 
how many mistakes! How many disappointed hopes! 
How many unfortunate enterprises ! Some, rushing into 
marriage as the promised land, engendered only pauper- 
ism and reaped only misery ; others, venturing without 
experience into the chances of business, encountered only 
bankruptcy and thought to escape through prohibition. 
A strange blindness that, which made them invoke, as a 
remedy for their evils, the very scourge which had caused 
the evils of their fathers, and which was, after all, only 
the revival of a privilege ! Such was the starting-point 
of the first and most fatal contradiction in our industrial 
legislation : while restoring freedom to manufactures, 
they did not restore it to commerce, and consumption 
was attacked by the false measures taken to increase the 
elements of production. Far from departing from that 



TARIFF ARISTOCRACY. COLONIES. 537 

false course, France has every day gone forward in it, so 
that for the old feudal aristocracy has been substituted a 
tariff aristocracy, who profit by monopolies, to the detri- 
ment of the mass of workers. The result of this system 
has been to bring about a permanent hostility between the 
heads of the manufacturing establishments, and to com- 
pel workmen to compete continually at the lowest price, 
that is to say, to increase their chances of wretchedness 
and privation. The tithe of our day is levied in the 
workshops ; our forges and our spinning-mills have be- 
come castles where sit, clothed in their armor of gold, the 
high and powerful lords of modern industry. 

The present colonial government is not less incompat- 
ible with the true situation of the colonies. There are 
no longer any colonies in the acceptation of the word ; 
traffic in negroes has been interdicted by solemn trea- 
ties ; slavery has been abolished by the English parlia- 
ment ; and, in the New World, a black republic has just 
made a treaty with its mother country, on terms of equal- 
ity. The English and the Spanish have lost their finest 
possessions in both Americas. And yet the colonial re- 
gime still exists : for want of a body, people attach them- 
selves to its shadow : there is a pretence of keeping up 
towards free nations the despotic and exclusive practices 
that had been adopted towards subject colonies. In vain 
have experience and political economy demonstrated that 
more would be gained by treating on a, liberal basis ; habit 
gains the victory, and the inconsistency survives. The 
commerce of a great people continues to be subordinated 
to the badly-comprehended interests of some little isles, 
like a vessel lashed to those bollards which float at the 
entrance to our roadsteads. Meanwhile, interests be- 
come complicated and suffer; slavery is in a ferment and 
nations do not perceive that their colonies are going off. 

There is nothing, even to the great highways of com- 
merce, which has not experienced a revolution since the 
beginning of this century. The Mediterranean has re- 



538 HISTORY OF POLITICAL ECONOMY. 

gained its sceptre ; and the city of Alexander is becom- 
ing again the entrepot of trade with the Indies. A flash 
from the genius of Napoleon has lighted again in Egypt 
the torch of industry, which had been extinguished for 
more than a thousand years. Algiers has yielded to our 
arms ; and Greece has come forth from her ruins. Piracy 
has ceased its ravages ; and into Constantinople even, the 
spirit of reform is daily penetrating, in favor of our influ- 
ence and our ideas. Our steamboats freely coast along the 
extensive shores of the Mediterranean, and unforeseen re- 
lations are established between nations long unknown to 
each other. Are not all these events destined to produce 
profound changes in European political economy? And 
is it not to be feared that by persisting in a legislation 
made for other times, we may be surprised by some fatal 
catastrophe? Did not Venice begin to decline the day 
when the Portuguese doubled the Cape of Good Hope ? 
The changes which we have just indicated are not the 
only ones which have taken place for the last fifty years, 
and which merit the attention of economists. Without 
going beyond the domain of material facts, we 'have only 
to cast our glance over the advance in the physical sci- 
ences, chemistry and mechanics. An entire new world 
has been discovered here, and we to-day consume several 
hundred million francs worth of products which were 
hardly known to our fathers. The general production of 
cotton cloths amounts to nearly two milliards ; that of 
sugar, to more than five hundred millions. By calculating 
the increase in the manufacture of woolen goods, linens, 
glass, the working of iron and coal, and the enormous de- 
■yelopment of the thousands of domestic manufactures 
established in the heart of our great cities, one cannot be 
slow to recognize that all the elements of production 
have changed, and that this world needs new laws. Every 
day brings us its discovery, and while the ships of com- 
merce are multiplying the cargoes of raw materials which 
arrive, the genius of mechanics is teaching more eco- 



GOVERNMENT ENTERPRISES. 539 

nomical processes of working them. The more numerous 
exchanges have in their turn led to modifications in the 
system of public and private credit. Necessity is by de- 
grees familiarizing minds with the organization of banks 
and with public loans ; and confidence, formerly so slow 
in coming, sometimes exceeds the limits of the possible 
in the great speculations of our time. The power of as- 
sociation no longer knows any bounds. As soon as an 
obstacle presents itself, an army of besiegers hasten to 
remove it and seem to make sport of even the opposition 
of nature. Here a suspension bridge unites two moun- 
tains ; further on, a marvellous tunnel attempts to pass 
under the bed of a great river ; elsewhere some canal * 
flies from reach to reach, like an imaginary line through 
space. 

Governments have earnestly taken hold of these bold 
works, and, to speak of only one country, we have seen 
France within a few years, though scarcely recovered 
from the troubles of her late revolution, resume and com- 
plete her public edifices, multiply her canals, open her 
railroads, clear out her rivers, and vote immense sums for 
the enlargement of her ports. -Virtual discoveries are 
thus being made in every country, which are equivalent 
to an increase of territory and which increase the private 
fortune of the inhabitants at the same time as the public 
wealth. No one can henceforth deny the importance of 
official intervention of the government in the great 
enterprises of general utility. If the civil power went a 
step farther and took the initiative in a great reform in 
such of our laws as have ceased to be in harmony 
with the present tendency of civilization, political econ- 
omy would have gained one of its greatest victories. Our 
civil laws still bear the marks of the times when they 
were passed and of the principle which inspired them. 
Napoleon, who gave his name to this Code, succeeded a 
regime of contests and spoliation ; he worked to reestab- 

* Erie canal, U. S. 



540 HISTORY OF POLITICAL ECONOMY. 

lish an aristocracy, and he was returning to feudalism, 
without reflecting that a new power had arisen on its 
ruins and henceforth ruled the world : this was industrial- 
ism. Its wings were yet folded under the protection of 
England ; but it was beginning to take its flight from the 
height of those great manufactories, which the genius of 
labor has multiplied since in all Europe. In vain the 
privileges of landed proprietorship, carefully maintained, 
seemed destined to perpetuate the old distinctions of 
caste and the superiority of the lord over the slave : com- 
merce escaped by the bill of exchange from the restric- 
tions of the mortgage system, and prospered from the 
severity of the law at the same time that land-proprietor- 
ship seemed dying of its favors. This immense question 
will some day be discussed. In face of the mortgage of 
more than eleven milliards which weighs upon the land 
of France and paralyzes her, the more independent at- 
tractions of manufactures and of commerce, still much 
restricted, must be a serious subject of reflection for 
economists and statesmen. There is an age of gold to 
be anticipated for agriculture, from an improvement in 
legislation in its regard. 

But the present solicitude of nations is especially di- 
rected toward the great works of intercommunication. 
The isolation which had kept them so long immersed in 
barbarism, gives place to relations daily more intimate, 
and the fall in the price of transportation adds an im- 
mense value to products hitherto despised. It must 
not, however, be expected that the great difficulties of 
political economy will be solved at a near future. Those 
which remain to be conquered belong henceforth to prac- 
tice, and there the smallest mistakes may result in de- 
plorable consequences. After having discussed for more 
than a century the greater or less importance of the in- 
tervention of governments, we must put them to the 
work wherever the isolated resources of private individ- 
uals have become insufiflcient. In matters of finance. 



IMPORTANCE OF STATISTICS. 54 1 

practice has given more than one solemn contradiction to 
theories. Who could have told, for example, when Dr. 
Price unfolded his ingenious theory of amortization, that 
that expedient, reputed so efficacious, would some day be 
ranked among the most sterile financial contrivances? 
When France, drawn into the fiscal system of the Resto- 
ration, thought to protect the colonial monopoly by load- 
ing foreign sugars with duties, who could have believed 
that that favor so eagerly demanded, would be the prin- 
cipal cause of the decline of the colonies? England 
thought for more than two hundred years, that the surest 
way of diminishing the number of the poor was to have 
a poor-tax, and the poor-tax has given rise to pauperism. 
It has been found that after having expended more than 
four milliards of francs to relieve the indigent,* Great 
Britain is obliged to reconsider her steps, to strictly re- 
vise her laws in that respect, and to combat, not without 
peril, the scourge to which an error in her political econ- 
omy gave rise. 

A profound study of facts has permitted a just esti- 
mate to be made of the value ol the conclusions of econ- 
omic theories. Most of these theories being only induc- 
tions derived from anterior facts, careless observation in 
obtaining those facts necessarily influenced the correct- 
ness of the conclusions deduced from them. Since the 
attention of governments has taken this direction, science 
has been able to advance with a safer step and adminis- 
tration to proceed with more certainty. How could 
taxes be levied on an equitable basis when there were no 
data, even approximate, of the profits of the various 
branches of industry, of the distribution of the profits 
among them, and of the number of workmen of whom 
'CiXQXX personnel y^2L^ composed? Is it long since we have 
known of the number of foundhngs, the population of 
our hospitals and that of our prisons ? And yet these 
bases of every reform and even of every good adminis- 

* See the Statistics of England, by Mr. Porter. 



542 HISTORY OF POLITICAL ECONOMY. 

tration are the most easy to collect, and the importance 
of the others has been appreciated for so long that the 
great Colbert had planned the execution of a work o( 
this kind.* No one henceforth approaches any question 
of political economy without having given himself to 
serious investigations into all the facts connected with it. 
When the English government wished to reduce the enor- 
mous duties which bore heavily upon the silks of .France, 
a solemn investigation permitted all interests to be heard ; 
and that investigation became a complete treatise on the 
subject. The discussion on renewing the charter of the 
bank gave rise to a similar work, the most thorough per^ 
haps which has been made on a question of finance. The 
project of establishing a system of communication with 
. India by the Red Sea was likewise preceded by the most 
thorough investigation. Finally, the investigation made 
on the occasion of the revision of the poor-laws, was the 
signal for an analogous work in all the countries of Eu- 
rope : every nation has desired to learn the gravity of its 
wound and to seek the means of healing it. 

Political economy, being appealed to for a solution of 
all these problems of social interest, gains new light every 
day, even in countries subject to an absolute government. 
The budget of expenses, that of ways and means, and 
the law concerning the accounts, permit an estimate of 
the true condition of the public fortune ; by the account 
rendered annually of civil and criminal justice, one can 
obtain an exact idea of the movement of affairs and the 
state of morals: the results of primary instruction, the 
budget of the communes and the local statistics, pre- 
pared with extreme care in some departments, f leave no 
refuge for the arguments in favor of the old routine and 

* This grand thought of Colbert was carried into execution. There exists 
in the department of manuscripts in the Royal Library a series of nearly 
one handred volumes of statistics, written out by the superintendents of the 
provinces, under the orders of the minister, which might still serve as models 
to our prefects. 

f That of the Upper Rhine, for instance, which leaves little to be de- 
sired. 



MATERIAL AND MORAL PROGRESS. 543 

prejudices. Industrial documents are more rare. The 
government, penetrated with the idea that all questions 
relative to production should be left to the vigilance of 
private interest, published only very late and very incom- 
pletely at first the facts of which it was the depository, 
such as tables of the imports and exports of merchan- 
dise, the product of the mines, and the number of indus- 
trial establishments of every kind. People knew nothmg, 
a short time ago, of the situation of the entrepots, of the 
importance of transit, of the extent of our coasting 
trade. By degrees, however, as facts are obtained more 
accurately, questions grow clearer and advance toward a 
solution that could never have been hoped for from the 
influence of principles alone. Thorough discussions in 
the Chambers have come, to complete, in these latter 
times, the instruction which had already resulted from 
the progress of statistics, and political economy has en- 
tered upon a new era, entirely of experiments and appli- 
cations. 

On whatever side one turns his attention, it is impos- 
sible not to be impressed by all the progress which has 
been realized since peace has permitted governments and 
peoples to concentrate their attention on reforms favor- 
able to the general prosperity. In all directions, people 
have comprehended that material power is only an aux- 
iliary to moral improvement, and that the production of 
wealth should be considered as truly useful only as there 
results from it a greater sum of well-being and of moral- 
ity to the workers. Consequently, in England even, the 
hours of labor for children have already been reduced, 
and the physical sciences have been appealed to for new 
means of rendering the workshops healthful. The pris- 
ons are no longer abandoned to the good pleasure of the 
jailers ; they have become vast industrial establishments 
where every day are made, with a solicitude that cannot 
be too much praised^ attempts at improvement which 
will soon bear their fruit. Official travelers, volunteers 



544 HISTORY OF POLITICAL ECONOMY. 

in that fine cause of humanity, have been over both 
worlds to study in them the methods that have been 
tried with the object of reforming criminals hitherto ne- 
glected. Beneficence itself takes counsel with science : 
it has become less prodigal of aid. The foundling asy- 
lums no longer keep the gates of their cemeteries wide 
open : a few ingeniously devised formalities have sufficed 
to recall mothers to a sense of their duties and to save 
the contributors considerable sums. Lotteries have been 
suppressed ; the public disapproval has caused gambling 
houses to be closed. 

In purely material matters, political economy has pro- 
moted no fewer surprising changes and unexpected im- 
provements. An entirely new population of possessors 
of personal property has arisen in the presence of landed 
property, and daily increases with unexampled rapidity. 
The wealth created by their industry makes numerous 
markets for agricultural products and immense resources 
for the public treasury. This explains the progress- 
ive increase of indirect taxes, designed to reach the in- 
dustrial fortune of nations, and to increase with it. Each 
year, the figure which represents the results of these 
taxes rises : letter-postage, stamps, tobacco, custom- 
duties, octrois, beverages, give revenues which are con- 
tinually increasing, because they are in proportion to the 
increase of public wealth. The same phenomenon is re- 
produced in all civilized countries, and the creations of 
manufacturing and commercial industries have taken such 
a development in certain countries, like England and the 
United States, that the indirect tax has become almost 
the sole basis of the budget of the receipts of these 
states. At the same time, the savings in them favor the 
multiplication of capital and permit labors to be under- 
taken under the auspices of association, which are pro- 
ductive of new savings and of indefinite wealth. All 
.boundaries seem to have enlarged before these armies of 
workers ; unknown mines are discovered ; virgin forests 



RESULTS OF CREDIT. 



545 



are worked ; products which seem fabulous are created. 
In France, the beet and the mulberry have doubled the 
consumption of sugar and of silk ; in England, flax 
threatens to supplant our linens; in Belgium, the con- 
struction of machines is already increasing on an im- 
mense scale, and seems yet scarcely begun. Who would 
dare maintain, in the face of these results, the possibility 
of keeping up an economic regime originating in other 
necessities and in circumstances so different ? 

Scarcely twenty years ago, Europe was thrown into ex- 
treme confusion by a general war, unprecedented in the 
annals of history. Maritime commerce was annihilated, 
manufactures suffering, capital dissipated ; credit seemed 
forever lost. Suddenly, France proclaims the principle 
of fidehty to engagements : she borrows enormous sums 
to pay her debts, and scarcely ten years have elapsed ere 
she has regained her strength, restored her manufactures 
and carried her commerce to the ends of the earth. At 
the very time when I am terminating this work, the 
capital in ■ our country invested in industrial enterprises 
amounts to more than two milliards of francs : it has 
reached twice that sum in England ; and the amount of 
capital invested in the public loans of all nations * cannot 
be estimated at less than five times that sum. The open- 
ing of canals t and the improvement oi roads have tripled 
the value of an immense amount of landed property, and 
in a few great cities land has been known to rise to the 
exorbitant price of a thousand francs the square metre. 
The national capital has everywhere increased with such 

* R. Dudley Baxter, in his work on " National Debts," (London, 1S71) 
p. 79, gives the total public indebtedness of the world in 1869-18 70 in'pounds 
sterlmg at £3,911,000,000. That of the various states of Europe is stated 
as then amounting to £2,165,430,000. Trans. 

fit is established, from reliable data, that the canal of the South (of 
France) has increased the annual revenue of the countries it crosses more 
than twenty millions and the treasury receipts more than four millions. It 
has likewise been ascertained that the canal of the Centre has increased the 
territorial revenue of France from five to six millions." 

(M, Pillet Will : On the expense and result of the canals, p. 61). Author's 
Note. 



546 HISTORY OF POLITICAL ECONOMY. 

rapidity and in proportions so extraordinary, that one 
can boldly afifirm that before twenty-iive years real estate 
in France will have tripled in value. The same rising 
tendency is observable in all Europe ; and peace, without 
the violent aid of any internal revolution, is sufficient to 
relieve those in the humblest condition, by favoring the 
emancipation of the laborers while increasing the profits 
of their labor. One cannot estimate exactly the changes 
which are everywhere taking place in that manner; but 
their number increases so regularly, that the constitution 
of society will finally be entirely renewed. Thus the 
most shocking social inequalities will disappear, and per- 
haps also some day the last traces of the proletariat. 

The science of political economy has a right to claim a 
good part of this progress and of the pacific disposition of 
Europe at the present time. The spirit of conquest and 
invasion has had its day. The most warlike nations have 
turned their activity toward more lasting works, and true 
patriotism henceforth consists in enriching one's country 
rather than in ravaging neighboring countries. Power 
has passed from the side of wealth ; barbarism has be- 
come unable to disturb the repose of civilized countries. 
Now, it is a- fine thing to make conquests over nature ; it 
is by mastering rivers, exploiting mines, opening canals 
and roads, that a* people proves its superiority and tri- 
umphs over its rivals. Men will soon be valued only in 
proportion to the services they can render and not to the 
ambition which they may please to manifest. Everything 
that can facilitate the increase of advantages in the various 
classes of society, has more claim to public attention than 
the promises, too rarely realized, of the most ardent inno- 
vators. The people do not live on ambrosia, and although 
political economy has been reproached with bowing their 
faces to the earth, by concerning itself too exclusively, 
with material products, every one knows to-day that the 
surest way to raise the dignity of man, is to protect him 
from want. Riches alone, or at least comfort, procures 



RESULTS OF INDUSTRIAL CIVILIZATION. 547 

the leisure by favor of which the citizen breathes freely, 
and properly enjoys the fruit of his labor. Whatever 
great and useful thing has thus far been accomplished in 
political economy, has had for its aim to procure men a 
little more leisure with less fatigue, and consequently to 
favor the development of intelligence among the more 
degraded classes. Besides, is not the greatest sum of 
personal independence among citizens, the surest guaranty 
of liberty ? Does despotism reign among rich people or 
among poor people ? 

There is no longer to-day a single village which does 
not participate directly or indirectly in the benefits of 
industrial civilization. As soon as a useful discovery is 
employed to advantage at one point, it gives rise to con- 
sumption at another ; and commerce transports into the 
most remote cantons of our provinces, the most ingenious 
and most recent products of our cities. Political econ- 
omy has convincingly demonstrated the happy effects of 
that reaction which has given us the lines of communica- 
tion, so varied and so numerous, with which the territory 
of Europe is furrowed. Geography plays an important 
part in the economic mechanism of modern times. Every 
one knows the value of the mouth of the Scheldt, that 
of the Rhine, and that of the Danube. The Rhine is no 
longer crossed by armies ; no more bridges are thrown 
over the Danube for great battles ; steamboats are estab- 
lished on these rivers. All these military rivers have 
become commercial lines. The contest now is between 
these rivers and the railways, the latest expression of 
industrial progress. Who could have told, in 1804, when, 
in an obscure corner of the country of Wales, a steam- 
engine was first put in motion over bars of iron to draw 
a train of cars, that this was the commencement of a 
revolution destined to change the face of the world! 
Hundreds of millions have been put, since then, at the 
service of that marvellous machine, which is still per- 
haps to the perfected locomotives of the future only 



548 HISTORY OF POLITICAL ECONOMY. 

as the match-lock muskets were to the fire arms of our 
day. 

But to how many questions do the changes wrought as 
a result of these admirable machines, give rise ! At one 
point, the value of property is increased ten-fold ; at 
another, reduced perhaps to a tenth: here, new markets, 
in another place, the loss of all markets. Five hundred 
thousand travelers circulate where there were scarcely a 
few thousand, and the bringing together of distant places 
effects revolutions like those which displacement of terri- 
tory might produce. Such are the new phases under 
which political economy must henceforth study the in- 
dustrial and social movement of which humanity will 
demand of it an account. It must keep its eyes always 
fixed upon that great law of the most equitable distri- 
bution of the profits of labor; so long as there are thou- 
sands of men deprived of the very necessaries of life, in 
the midst of a society so rich in capital and machines, 
there will remain something to be done and the task of 
the economist will not be ended. Civilization is called 
upon to provide a common protection, as does the sun, 
for rich and poor, strong and weak, the inhabitants of 
the city and those of the country. Political economy 
must indicate to civilization the measures to be taken in 
order to extend each day the benefit of that protection. 

I will cite, in conclusion, a striking example of what 
remains to be done in that noble career. It is to-day in- 
contestable that public wealth has increased in Europe 
and principally in France, rapidly and brilliantly. In 
what proportion to the former fortune of the different 
countries, no one knows ; neither is it known in what 
proportion the profits are distributed among the different 
classes of workers. One thing is certain, the population 
of the great cities, and especially of the manufacturing 
and commercial cities, have profited much more than 
that of the rural districts by the general progress in 
wealth. Our cities are every day embellished with new 



CONTRAST BETWEEN CITY AND COUNTRY. 549 

constructions ; the citizens who inhabit them enjoy more 
of the amenities of life than formerly ; the middle 
class are better lodged, better clothed, better fed. 
Elderly people who were able to observe the general 
aspect of city populations a half century ago, are struck by 
the contrast between their present appearance and that in 
the past. The suburbs of every great industrial and com- 
mercial centre, like Havre, Rouen, Lille, Mulhouse, Saint- 
Quentin, Lyons and Marseilles, are covered with opulent 
faubourgs and delightful country-houses. The villages 
alone remain unchanged, and preserve, from generation 
to generation, their aspect of poverty and of monotony. 
One sees in them only dirt and squalor ; everywhere are 
walls in ruins, huts covered with thatch, children badly 
clothed and worse educated. Now, if we consider that 
the inhabitants of these dreary lodgings compose two- 
thirds of the French population and consume scarcely a 
fourth of the product of our manufactures, we shall rec- 
ognize that there remains much to be done to ameliorate 
their condition and to secure markets for our manufac- 
tured products. Is it not a subject for reflection, this 
system of production which obliges us to seek consumers 
at the ends of the earth, when at our own gates, in the 
heart of our own country, we have workers who lack for 
everything ! We cannot sell our cloths, and yet more 
than ten thousand of our fellow-citizens have no under- 
clothing ! We ask for bounties on the export of sugars, 
and there are old men and children who have never 
known and perhaps never will know, that article ! • A 
hundred acres of land are sold for less in Sologne and in 
the Landes, than a ditch in Paris to be buried in ! These 
are strange contrasts : political economy is full of them, 
and yet a new history full of contrasts more strange is 
beginning for her at the moment when this ends. 



APPENDIX. 



1. "Bottomry loans," p. 6. — These are loans where money 
is lent upon the ship's bottom, as it is termed : i.e., the ship is 
pledged as security and the lender takes the risks of the voyage. 

2. " theorikon," p. 12, 14. " theorika," p. 16. — Originally, 
money given to citizens from the public treasury to pay for 
seats at the theatre : later, given also for other purposes- 
Theorika., the plural, is used both for the moneys paid, and for 
the theoric fund, from which the distributions were made. 

3. ^^ jeton de presence,'' 1^. 12. — A counter given to a person 
present : — also contemptuously used for small coin. 

4. " quarry," p. 16, i.e., game, prey, booty : a hunter's term. 

5. ^^ Sectionists," p. 16. — i.e., such of the citizens of the 
sections as could bear arms and attend the meetings of the sec- 
tions. Paris was at that time divided into 48 sections (electoral 
divisions), thirty-three of which had declared their votes for 
insurrection. The commissioners of the sections, " vested with 
the full powers of all the sections," had annulled the constituted 
authorities, (as a majority of the sections could lawfully do), 
and reorganized the government as seemed to them desirable. 
Among the new measures adopted, was that in reference to the 
" forty sous," of which Thiers (Hist. Fr. Rev., Vol. ii.— Sho- 
berl's translation) speaks thus : 

"In order to insure the aid of the people and to keep them 
under arms in these moments of agitation, it was next resolved 
that forty sous per day should be paid to all the citizens on 
duty who were in narrow circumstances, and that these forty 
sous should be taken from the product of the forced loan ex- 

551 



552 APPENDIX. 

torted from the rich. This was a sure way of calling to the aid 
of the commune and against the bourgeois of the sections, all 
the working people, who would rather earn forty sous assisting 
in revolutionary measures, than thirty sous by pursuing their 
ordinary avocations." 

Thomas Carlyle, in his French Revolution (Book iv. Chap. 6), 
says .' '■ Danton, through the organ of Barere and Sault Public 
gets decreed, that there be in Paris by law, two meetings of 
Section, weekly ; also that the poorer citizen be paid for at- 
tending, and have his days wages of forty sous. This is the 
celebrated ' Law of forty sous,' fiercely stimulant- to Sansculot- 
tism, to the life circulation of Jacobinism," etc., etc. 

'* Forty sous/i?r dievi were promised to the Sans-Culottes as 
long as they should be under arms." (Hist, of France, by 
Emile de Bonnechose, p. 537.) " Every indigent person re- 
ceived forty sous per diem for assisting at the assembly of his 
section." (p. 540.) 

" Immediately the Commune {i.e., the municipality of Paris) 
appoints Henriot, a coarse and brutal drunkard, chief of the 
sections ; it decrees to pay forty sous to every poor citizen who 
takes up arms ; " etc. {French Revolutionary Epoch, by Henri 
Van Laun, Vol. i, p. 276, Amer. edition.) *' The section shall 
sit twice a week, and in order to insure the attendance of its 
members, all those present at its sittings shall receive forty sous 
for their loss of time." {The same, p. 284.) 

6. " Octroi," pp. 20, 68, etc. — An impost levied by towns 
upon merchandise brought within their limits. The octroi was 
paid at the gates of the city or town. 

7. " Proletary workmen," p. 56. — These were the lowest 
class of laborers, except slaves. They were valued by the State 
principally for their progeny, who were needed for war. Hence 
their name. 'L^Xm, proletarii, ixom. proles, progeny. 

8. " Corvee." pp. 67, 68, 122, etc. — Compulsory labor, either 
statute or feudal. 

9. " frameaS;" p. 88. — A kind of javelin, (v. Case's Fr. Die.) 

10. '■ Harpagon," p. iii. — The miser in ''L'Avare," a 
comedy by Moliere. 

11. *' Assizes of Jerusalem," p. 131. — The code of feudal 
law framed for the kingdom of Jerusalem. 



APPENDIX. 553 

12. "sbires," p. 194. — A particular class of archers. 

13. "'donzels,'" p. 194. — The donzels were pages in attendance 
on the magistrates. — v. Vocabulario degli Academia della Criisca. 
Also, Alter ti, Die. Ital. Frangais. 

14. " natives," p. 200. — The French word " nationaux " ap- 
plies as well to those bred in a country as to those born there. 
The equivalent noun in English would be "nationals." 

15. "Universal" suffrage of gold and silver, p. 245. — The 
Indians who used wampumpeag for money, (v. Prof. Sumner's 
Hist, of Amer. Currency), do not seem to have had any ac- 
quaintance with the precious metals. Travellers tell us of many 
peoples who do not use gold and silver for money ; among 
others, the Abysinnians, who use salt for money ; the people of 
Bornu, a powerful state of Central Africa, who employ cowrie 
shells for the same purpose ; and many others. In the Society 
Islands, gold and silver are very rare. Prof. Jevons tells us 
{Afoney^p. i,) that when Mile. Zelie, of the Theatre Lyrique of 
Paris, sang an air from Norma and a few other songs at a con- 
cert in one of these islands, her share of the receipts was 3 
pigs, 23 turkeys, 44 chickens, 5,000 cocoa-nuts, besides consid- 
erable quantities of bananas, lemons, and oranges. From the 
same source we learn that Mr. Wallace, a traveller in the Malay 
Archipelago, says that in some of the islands there was no 
proper currency, and he could not procure supplies for dinner 
without a special bargain and much chaffering on each occa- 
sion. He was therefore obliged to keep on hand quite a variety 
of articles, to multiply the chance that one of them would suit 
the itinerant merchant. 

16. " As a loan," p. 338. The French reads, " en comfnan- 
dite." Companies '''' en co7Ti7nandife" are those where all but the 
managing partners are only responsible to the amount they 
have subscribed. In Law's system the owners of public stock 
were comtnandiiaires, i.e., silent partners with limited liability. 

The New York law for limited partnerships seems to be the 
exact equivalent of the French law for societes en commandite. 

17. "P/iysiocratie," p. 356. "A few generous and right- 
eous philosophers struck out the idea that there must be some 
great natural science, some principles of eternal truth, founded 
on nature itself, with regard to the social relations of mankind. 



554 APPENDIX. 

the violations of which were the causes of that hideous misery 
they saw in their native land. The name they gave this science 
was Natural Eighty and their object was to discover and lay 
down an abstract science of the natural rights of men in all 
their social relations. And this science comprehended their 
relations towards the government, towards each other, and 
towards property. The term politiqjte in French might in a 
certain way have expressed this science, but that word was so 
exclusively appropriated to the art of government that they 
adopted the name of Political Economy for it, and hence were 
commonly called the Economists. One of their number pro- 
posed the name of Physiocratie. or the government of the 
nature of things, and hence they were often called Physio- 
crates ; but the word having been appropriated to certain 
doctrines of the sect, which are now shown to be erroneous, 
has fallen into disuse, and the term Political Economy, or 
Economics, has survived." — Macleod, Econ. Phil. Vol. i, p. 58. 

18. "Encyclopedic Philosophers," p. 362. This term is ap- 
plied to the various authors of high literary and philosophical 
attainments, who Avrote for the famous Encydope'die published 
1 751-17 7 2, in 28 vols., edited by D'Alembert and Diderot. 
These writers were (besides the editors) Rousseau, Grimm, Du- 
marsais, Voltaire, Baron d'Holbach, and J aucourt. Nearly all 
of them entertained ideas more or less revolutionary, and their 
articles were written with a boldness which brought the Ency- 
clopMie under the ban of the government. Its contests with 
the latter form an interesting episode in the history of the 
times. — V. art. Encyclopcedia, in Ency.i Brit. 

19. " Father Bridaine," 408. A preacher, b. 1701, d. 1767. 
Demogeot, in his Litter ature Frangaise (p. 547) calls Delille 
" the Bridaine of tragedy." 

20. "increase of taxes the cause," etc., 435. We are unable 
to find this opinion in Ricardo's works. On the contrary, 
Ricardo says (p. 109, McCulloch's edition) : " Everything which 
raises the exchangeable value of commodities of any kind, 
which are in very general demand, tends to discourage both 
cultivation and production ; but this is an evil inseparable 
from all taxation, and is not confined to the particular taxes 
of which we are now speaking." 



APPENDIX. 555 

21. "Amortization," p. 436, i.e., extinction of the public debt, 
particularly by funding. Dr. Price's theory of amortization, 
here referred to, was a plan for the extinction of the public 
debt of Great Britain, by a sinking fund. Blanqui, in his 
Bibliography, in noticing a work by Dr. Price, entitled. Politi- 
cal Arithmetic, says of him : " He was the first to propose a 
sinking-fund by means of compound interest." The work in 
which Dr. Price expounds his theory, is entitled : An Appeal 
to the Public on the Subject of National Debt, by Richard Price, 
D.D., F.R.S. (London, 1774). J. R. McCulloch, in his Litera- 
ture of Political Pconomy, gives an account of Dr. Price's work. 

Inasmuch as the sinking-fund delusion, so far from being 
dead, is now a part of the Law of the United States (by Sink- 
ing-Fund Act of Feb. 25, 1862), it may not be amiss to quote 
Mr. McCulloch 's article. He says : 

" This work contains a pretty full development of what its 
author believed to be the peculiar and distinctive properties of 
a sinking-fund, and is important from its being the foundation 
of Mr. Pitt's famous project. 

"After the termination of the American war, and the consoli- 
dation of his ministry, the devising of means for the reduction 
of the public debt became an object of Mr. Pitt's special at- 
tention. To accomplish this he adopted one of the three pro- 
jects furnished him by Dr. Price for establishing a sinking- 
fund. 

"This fund was managed by Commissioners appointed for the 
purpose, and consisted of ;^i, 000,000 a year set apart for that 
peculiar service, with what were called its accumulations at 
compound interest. These were formed as follows : at the- 
outset of the scheme, the commissioners would purchase with 
the million assigned to them (which, be it observed, was wholly 
derived from taxation) a million's worth of stock, on which 
they receive a dividend of say four per cent : consequently at 
the end of the first year they would have their annual million 
plus the dividend accruing on the stock previously bought by 
them, or ^1,040,000 to lay out in the purchase of fresh stock ; 
at the end of the second year they would have ^^i, 081, 600 ; at 
the end of the third year p^i, 124,864, and so on. Now this is 
what Sir Nathaniel Gould, Dr. Price and Mr. Pitt call paying 



556 APPENDIX. 

off the public debt by a sinking-fund increasing at compound 
interest ; but it is obvious that whatever diminution is effected 
in the amount of the public debt in the way now stated, is 
brought about by devoting a portion of the produce of tax- 
ation to its extinctiofi. 

" It is true that by applying any given sum to the purchase of 
stock, and then constantly applying the dividends upon the 
stock so purchased to the extinction of the debt, its reduction 
is effected in the same way as if the original sum had really 
been increasing by an inherent energy of its own, at compound 
interest ; but it is essential to know, that though the results be 
the same, the means are totally different. The debt is reduced 
because the taxes required to pay the dividends or interest on 
the stock purchased by the Sinking Fund Commissioners, in- 
stead of being remitted to the contributors, continue to be 
taken from them, and applied to the purchase of stock. It is 
the merest delusion to suppose that the debt either has been or 
ever can be reduced by the agency of any independent fund 
increasing at compo^und interest. To make capital increase in 
this way, it must be employed in some productive industry ; 
and the profits, instead of being consumed as income, must be 
regularly added to the principal, to form new capital. It is 
unnecessary to say that no such fund ever existed. Those that 
have been set on foot in this and other countries have all been 
supported either by loans or by the produce of taxes, and have 
never paid off, and never by any possibility could pay off, a 
single shilling of debt by their own agency. 

" In 1792, some further additions were made to Mr. Pitt's sink- 
ing-fund ; and it was then also enacted, that besides providing 
for the interest of any loan that might henceforth be contract- 
ed, additional taxes should be imposed to form a sinking-fund 
of one per cent, on the capital stock created by such a loan. 
As there was considerable excess of revenue, in the period be- 
tween 1786 and 1793, the debt was reduced by about ten and 
a-half millions, and this reduction was ascribed to the effect of 
the sinking-fund increasing at compound interest, though, it is 
plain, it entirely resulted from the application of surplus rev- 
enue to the purchase of stock. Subsequently to the commence- 
ment of the revolutionary war the income of the country uni- 



APPENDIX. 557 

formly fell greatly short of the expenditure, and the debt rap- 
idly increased^ 

"But though there was no anmia I million in the Treasury to 
transfer to the commissioners, the juggle of the sinking-fund 
was kept up. Dr. Price had been sanguine, or rather we may 
say absurd enough to allege that ' any suspension of the sink- 
ing-fund during war would be the madness of giving it a mor- 
tal stab at the very ti?ne it was making the quickest progress to- 
ward the accomplishment of its end.' (Appeal, etc., p. 17.) 
And even this was believed ! In consequence, the loans for 
the service of the year were uniformly increased, by the whole 
amount of the sums placed at the disposal of the Sinking-Fund 
Commissioners, so that, for every shilling's worth of stock 
transferred to them by this futile proceeding, an equal or 
greater amount of new debt had to be contracted, exclusive of 
the loss incurred on account of management ! 

" Such was the sinking-fund, the object of laudation of all 
parties. It was universally considered as the great bulwark of 
the country, as a means by which 'a vast treasure was to be ac- 
cumulated out of nothing ! ' And so lasting and powerful 
was the infatuation, that after fourteen years' experience of its 
nullity, when a new financial project was introduced in 1807, 
it contained a system of checks to prevent the evils likely to re- 
sult from allowing the sinking-fund to accumulate without any 
limit, and deluging the country with a flood of wealth, by ' a 
too prompt discharge of the public debt ! ' 

" The history of the world does not furnish another instance 
of so extraordinary a delusion. Had the sinking-fund involved 
any unintelligible dogmas, had it addressed itself to popular 
feelings or passions, or had the notion of its efficacy originated 
with the mob, the prevalence of the delusion would have been 
less unaccountable. But it was from the first a matter of mere 
calculation ; it was projected by some of the best-informed per- 
sons in the country, who continued for upward of twenty years 
to believe that they were rapidly diminishing the public debt 
by the agency of a fund, which was all the while kept on foot 
by borrowed money ! Dr. Hamilton of Aberdeen has the 
merit of having dissipated the illusion — the greatest, certainly, 
by which any civilized people was ever blinded and deceived. 



558 APPENDIX. 

He showed that the sinking-fund, instead of reducing the debt^ 
had increased it : and he proved to demonstration that the ex- 
cess of revenue above expenditure is the only real sinking-fund 
by which any part of the public debt can be discharged. ' The 
increase of revenue,' he observes, 'or the diminution of ex- 
pense, are the only means by which this sinking-fund can be 
enlarged, and its operation rendered more effectual ; and all 
schemes for discharging the national debt, by sinking-funds op- 
erating at co7npound interest, or in any other manner, unless in 
so far as they are founded on this principle, are completely il- 
lusory.' 

" The act of lo Geo. IV. consecrated this sound principle ; 
and terminated the Sinking-Fund." 

History repeats itself. We copied all the errors of England 
and profited not at all by her example. 

(See Ricardo's essay on the Funding System, found in Mc- 
Culloch's edition of his works.) 

22. "Bank of England," etc., p. 437-8. (i.) "exhausted," 
etc. (2.) " Notes payable in gold." (3.) " virtual bankruptcy." 
(4,) " government had the good sense," etc. (5.) " rise of prices." 

(i.) From the commencement of the war in 1793, to 1797, 
the Bank of England had made excessive loans to the Govern- 
ment, and its ability to grant even its usual discounts to cus- 
tomers had become impaired. Early in 1797, England was 
overtaken by a commercial panic, which was intensified by a 
reported invasion by the armies of France, and a consequent 
hoarding of money. On the 26th of February of that year, the 
Bank's stock of coin was so reduced that it is quite probable 
that the Bank would have been compelled to suspend cash 
payments {i.e., payments in coin) if the Government had not 
intervened. The Government did intervene, and by an Order 
in Council forbade the Bank to pay out cash {i.e., coin) until the 
sense of Parliament could be taken. 

Parliament confirmed the restriction, and continued it by 
successive acts until 1821. 

(2.) The notes of the Bank were on their face payable on 
demand in lawful money, which was gold or silver coin, silver 
being then a legal tender up to ^25. {v. Lord Liverpool's 
Letter to the King, on the Coins of the Realm, 1805, p. 129.) 



APPENDIX. 559 

(3.) This suspension, or restriction, as it was called, was 
ordered by the government, and was in no proper sense "a 
virtual bankruptcy." The Bank was entirely solvent, as an ex- 
amination of its affairs by a ' Parliamentary Committee then 
showed, and as subsequent events fully confirmed. 

The assig7iats and mandats of France, "though secured by 
national property, fell to the last degree of demonetization," 
because of the excessive amount of them put into circulation 
(many having been forged in England and smuggled into the 
country), while inconvertible notes of the Bank of England 
depreciated little, because the Bank increased its issues but 
slightly beyond the amount of coin displaced by its notes. 

Confidence that others will willingly receive it, is necessary 
to give currency to inconvertible paper money; but, while in 
general circulation as money, its value, other things remaining 
the same, depends upon the quantity. Tender-laws may aid, 
but they are not indispensable to give currency to such 
money. 

Bank of England notes were not a legal-tender for debts. 
The merchants of London, immediately on the restriction being 
proclaimed, met and unanimously agreed to take Bank of Eng- 
land notes in all their transactions. Public opinion — not statute 
law — continued Bank notes, without any payment by the Bank, 
as the money of the country for twenty-four years, or during 
the whole period of the restriction. 

(Consult McCulloch's Dictionary of Commerce, art. Bank 
of E7igland J History of British Commerce, by Leone Levi, 
p. 132 ; Macleod's Dictionary of Political Econoj?iy, under 
Banking in England, Vol. I, p. 94 ; History of the Curren- 
cy, by James MacLaren, (ist edition,) p. 77 ; A System of 
Political Econojny, by John L. Shadwell, p. 347 ; Doubleday's 
Financial History of England, p. 187 ; the opinions of all the 
judges of the Court of Common Pleas, in the case of Grigby 
vs. Oakes & Co., given in extenso on pp. 291-7 of Cobbett's 
History and Mystery of the Bank of England ; and Prof. Sum- 
ner's History of the Afne^Hcan Currency, p. 235, in the chapter 
on the bank restriction in England.) 

It is true that Parliament passed two acts to add to the cur- 
rency of Bank notes, viz.: (i) That anyone tendering Bank 



560 APPENDIX. 

of England notes should not thereafter be subject to arrest for 
that debt, and (2) the property of a tenant making such 
tender, could not be distrained for rent ; but all other remedies, 
notwithstanding such tender, were open to creditors then as 
now. 

It is doubtless true that for the Bank of England notes to 
have been discredited would have been a " most fearful catas- 
trophe." No such catastrophe occurred, because the people 
had full faith in the solvency of the Bank, and their faith was 
well-founded. 

(4) The government did not intervene, in the matter of issu- 
ing bank-notes, as Blanqui both here and elsewhere implies. 
The Bank was subject to no restriction as to the amount of its 
issues at any time during the suspension of its cash payments. 
On the contrary, it was in this matter governed only by its own 
discretion. By what rule the Bank ought to govern itself in the 
issue of its notes, was a most fruitful source of discussion dur- 
ing the whole period of the Bank's restriction, 1797 to 1821. 

(5) The issues of the Bank of England continued to in- 
crease steadily, though irregularly, from 1797 to 1817. That there 
was no material depreciation of Bank notes compared with coin 
from 1797 to 1808, is sometimes thought paradoxical. There 
was, however, nothing mysterious about it. No material de- 
preciation of Bank notes could take place until after the increase 
had displaced all the coin ; at least, all the coin of full weight 
and full tender. In the case of England, the coin was very 
slowly displaced, on account of the law against its exportation, 
and because of its worn and degraded state. 

It is true that the continually increasing issues of paper money 
" seemed to make monetary wealth more productive ; " but it 
was in fact rising prices due to the over-issue of inconvertible 
paper money which stimulated the production of commodities 
of all kinds and the accumulation of wealth. It js not unlikely 
that had it not been for the rising prices due to such issues, it 
would have been impossible for England to carry on that great 
war and bring it to a successful conclusion. 

(For full elucidation of the principles involved in the phe- 
nomena here noted, see Francis A. Walker's late work, (1879), 
Afoney in its Relations to Trade and Industry ; also R. H. 



APPENDIX. 561 

Patterson's work on Economy of Capital^ Edinburgh and 
London, 1865.) 

(The dates and limitations of the thirteen successive acts of 
Parliament, proclaiming and continuing the Bank restriction, 
may be found in Lawson's History of Bankifig, as also a copy 
of the original order suspending or restricting cash pay- 
ments.) 

23. " return to specie payments." p. 439. Several years 
elapsed after the close of the war, before resumption of specie 
payments was finally effected. The act under the operation of 
which they took place (according to general opinion) is 
known as Peel's Act of 1819. This act did not compel payments 
in coin until May i, 1823. Until that time and dating from 
February i, 1820, the Bank was directed to pay its notes in 
ingots of gold bullion, if they were presented for sums of not 
less than 60 oz. at a time. " The accumulation of treasure in 
in the Bank became so rapid in 1820, that early in 1821, the 
Directors felt themselves in a position to resume payments in 
coin : and they obtained an Act, permitting them to do so on 
May I, 182 1, instead of 1823, as Hmited by Peel's'Act." H. 
D. Macleod, Econ. Phil. vol. ii, chap, xviii, § 14. Macleod's 
account of the Bank will be read with interest. He, however, 
denies all efficiency to Peel's Act, (p. 460, Econ. Phil, vol., ii), 
and quotes one of the Bank Directors in support of his opinion. 
He says the Act enacting that the Bank might resume pay- 
ments in gold coin May i, 182 1, was the real Act under which 
cash payments were resumed. 

24. " Posterity," p. 456, 12th line. Posterity does not seem 
to have confirmed the judgment of Blanqui in regard to 
Cobbett. 

Cobbett's strength lay in his use of language. He was direct, 
terse and forcible, and was a master of sarcasm and invective. 
It has been said that the popularity of his pamphlet, " Paper 
against Gold, etc.," was due " more to manner than to matter ; 
that, with more of fancy than of fact, he was pungent, not 
personal ; caustic, not critical ; with more philippics than 
philosophy, more rhetoric than reason, more sarcasm than 
sense." We cannot, however, wholly agree with this judgment. 
The information he gave the people in regard to the origin and 



562 APPENDIX. 

history of their funded debt and the Bank of England, as well 
as in regard to the Sinking- Fund, (anticipating on this latter 
subject, though crudely, the work of Dr. Hamilton in 1813), 
seems to us, when taken in connection with his vigorous man- 
ner of presenting subjects, to sufficiently account for the popu- 
larity of his writings. Cobbett opposed every species of paper 
money. 

25. "pay the public debt," etc., p. 460. Ricardo's plan may be 
found on p. 149 of McCulloch's edition of his Avorks. Ricardo 
himself says of it : " This scheme has been often recommend- 
ed, but we have, I fear, neither wisdom enough, nor virtue 
enough to adopt it." 

E. J. L. 



INDEX. 



Abot de Bazinghen. Writer on 
moneys, 26x. 

Adrian. His public distributions, 55. 
Advetiturers — rivals of the Hanse, 154. 
Affranchisement of Communes, 156- 

T64. 
Affranchisement of Labor, 428. 

" " Slaves at Rome, 

78. 
Agio, 327. 

Agiotage, 50, 340, 341, 342. 
Agrarian Laws, 62. Advocated by 

Babeuf, 427. 
Agricultural system (of Quesnay), 353 

-361, 390. 

Agriculture, 8, 6, 3. (In Italy), 51, 
foot-note. 54. Affected by Prot. 
Ref., 226. Encouraged by Sully, 
268. Under Henry IV, 528. Af- 
fected by Colbert's tariff of 1667, 
288. By Law's System, 348-352. 
By doctrines of Economists, 352 et 
seq. After French Revolution, 536. 
Much to be anticipated for it, 540. 

Aids, 303. 

Alan of Walsingham, 250. 

Alembert (D'), 378. 

Alexander, 20, 21. 

Algarotti, 523. 

Alliance (of kings and communes 

against clergy), 158-g. 

Allies (of Athens), 13, 22 

Allodial lands, 98. 

Ambassadors (instructions to), 285. A. 
in Greece, 17. 



American Revolution, 432, 434. 
Amortization, 436 and n. 21 App., 

440, 541- 
Ancient Polit. Econ. contrasted with 

modern, 5. 

Anderson, quoted, 223. 

Apollo (Temple of), a bank of deposit, 

21. 

Appreciation of Money. At Rome, 
248-252. In modern Europe, 257- 
259, and 258 foot-note. In Eng., 
on resumption of specie payments, 
439. In Eng., in 1810, 455. v. 
Money. 

Aqueducts, 58. 

Arbitration (required by Sully), 276-7. 
Architects, rewarded in Ital. Repub- 
lics, 192. 
Arimanni, 122. 

Aristocracy. Tariff — substituted for 
feudal — 527. 

Aristeides, 12. 

Aristophanes, quoted on number of 
cities subject to Hellenic yoke, 14, 
Author of Revenues of Attika, 10. 

Aristotle, prepared way for a solution 
of econ. questions, 8. His econ. 
treatises, 37. Ideas on Slavery, 10, 
37, 38. Chrematistics, 38. Ideas 
on money, 39, 40, 242. On vakie, 
39. Recognizes other than material 
products, 40. Classes society, 41. 

Arkwright. Econ. effect of his in- 
vention, 430 et seq., 434. 

Arts. At Athens, under Perikles, 13. 
14, foot-note. Useful arts, 17. At 



563 



564 



INDEX. 



Sparta, 28. At Rome, 48, 57. 
Under Barbarians, 95. Industrial 
arts in Italy, 190, et seq. 196. Fine 
arts, 192. In Italy in time of Chis. 
V, 212. V. Industries. 
Asia. Its conquest caused westward 

movement of specie, 20. 
Assessment of taxes, v. Taxes and 

Taxation. 
Assignats, 22, 421-2. Benefits of, 
421. Contrasted with Bk. of Eng. 
notes, 438. 
Assizes of Jerusalem, 131 and n. xi. 

Appendix. 
Association. At Athens, 15. In 
Hanse League, 146 et seq. In 
banks, (v. Banks). Due to Credit, 
329. Developed by Law's system, 
349. Imported into France from 
Eng., 429. Growi!?gir?iportanceof, 
etc., 491. Essay on Spirit of Asso- 
ciation, by Laborde, 489, 490. Ex- 
pounded by St. Simon, 501-507. 
Must begin at school, 519. No 
longer knows bounds, 539, 544. 
Asylums, (in Europe) due to Chris- 
tianity, 83. House of refuge found- 
ed by Colbert, 293. Foundling — - 
294 and foot-notes, 397 and foot- 
note, 545. 
Athens. Her slavery, lo-ii. Public 
works, 11-13, foot-note. Democ- 
racy, 13, foot-note. Arts, 13, 14, 
foot-note. Theonko7z, 12, 14, 16. 
Mines, 18, 19. Sources of revenue, 
19. Banking and interest of money, 
21. Public loans, 22. Taxes, etc., 
15, 18-23. Colonies, 44 et seq. 
Attika (Mines of), 19. 
Aubaine — suppressed by Colbert, 285. 
Austro-Spanish Imperialism. — Its 
economic results, 210, 211 et seq. 
Protest against, 216, 217. 

Babbage (Chas.). His work on Econo- 
my of Manufactures, 466. 

Babeuf. Mentioned, 403. Advocated 
Agrarian Law and abolition • of 
property, 427. 

Bailly, author of Histoire financiere de 
la France, quoted p. 291. 

Balance of Trade. First errors of, 
166. Proved a vagary, 390. Mon- 
tesquieu erred here, 411, 412. Vol- 



taire fell into same error, 415. Con- 
tradicted by experience of U. S., 
433. Engendered in Spain, 526. 
J. B. Say's testimony on the sub- 
ject, 451. v. Mercantile Systetn. 
Bandini. — showed advantages of a 

single tax, 523. 
Bank. — Temple at Delphi a bk. of de- 
posit, 21. Loan bks. of Jews, 142 
et seq. Institution of bks., 322- 
332. Bk. of Venice, 197-8, 322, 
324. Bk. of St. George at Genoa, 
206-7. 322, 324. Bk. of Eng., a 
result of prohibition, 320. Bk. of 
Eng., 320 and ist foot-note : n. 22, 
App. ; 330 et seq. ; 349, 437-441, 
543. Bk. of Hamburg, 322. Of 
A/nsterdavi, 320, 322, 324-327. Of 
Barcelona, 322. Of John Law, 
335-350. Of St. Chaides in Spain, 
527. Adam Smith on bks., 323-4, 
329, 383. Thornton on bks., 455. 
Sismondi on bks., (shows their dan- 
gers), 469, 470, 474. Storch on 
bks, 488. Smith, Steuart, Say, etc., 
329. Bks. in relation to machines, 
469, 470, 471, 480. Hist, of bks. 
quoted, 207, 331, note. Savings 
bks, for workmen recommended, 
478. Savings bks., 534. Bks,' 
539- 

Bank-bills. — Demand for those of 
Law's bank, 338. v. Bank of Eng. 

Bankers of Florence, 195. 

Banking, lucrative at Athens, 21. 
Notes, p. 331, 332. v. Banks. 

Bank-money, 324. 

Bankruptcy, of Bk. of Eng., 330, 331, 
349, 437-8, n. 22, App. Immi- 
nent in France, 335. Of Law's bk., 
345. — Of France, 393, 422. 

Barbarians. 87-100. ist appearance, 
87. Codes, 89. Points of agree- 
ment with Christian Church, go. 
Prepared emancipation of laborers, 
92. Barbarian and Roman civili- 
zation contrasted, 93-95. Result- 
ing changes in social constitution 
of Europe, 96-100. 

Bargemont. v. Villeneuve. 

Barons. Trades protected from tyr- 
anny of, 7. Sacredness of word 
among, 124. Form league against 
clergy, 130. Encourage crusades, 
124. Oppose communal privileges 



INDEX. 



565 



of bourgeois, 160, 161. Receive 
payments from bourgeois, 161 
Possessed soil and disdained labor, 
162. 

Baudeau (Abbe). Interpreter of 
Economists, 359. Views on suprem- 
acy of civil power, 364. 

Baudrillart, on origin of prohibition in 
France, 287, foot-note. 

Beccaria (Marquis of), wrote on divis- 
ion of labor, etc., 523. On moneys, 
261. 

Beggary, 526. v. Mendicaiicy. 

Benefices, become hereditary, g8. 
Their hereditary transmission the 
germ of the feudal system, 116. 

Bentham (Jeremy). On legislating 
rates of interest, 373. 

Berlin Decree. Its near economic ef- 
fects, 424. Its later effects, 425^6. 

Beugnot (Arthur), cited on Occidental 
Jews, 139. 

Bill of exchange — its origin, 141-144, 
note. Its convenience. 259. Col- 
bert's declaration on drawing and 
negotiation of, 296. Its aid to 
commerce, 540. 

Billon money, in Greece, 21. 

Black Code (Code Noir), 297. Trade 

in b's, i\~i<:). 
Blanqui. Sketch of his life, ix. 

Bceckh, quoted on rents at Athens, 22. 
On poor tax, 15. On public econo- 
my of Ath., 24. 

Boetie (La), cited, 218, n. 

Boisguilbert, on bad distribution of 
taxes under Louis XIV, 303. Con- 
dition of France, 304. 

Boizard. Fr. writer on moneys. 261. 

Bottomry loans — known to ancients, 
6 and n. I, Appendix. 

Bourgeois, Acquire property, 120. 
Support kings against barons, 158- 
160. Quarrel with monks, 158. 
Obtain franchises, 157 et seq. : 
massacred, 265. Importance of, in 
Italian Republics, 191. 

Boutteroue, Fr. writer on moneys, 
261. 

Boyleau, entrusted with organizing 
trades, 179. Execution of the work, 
179-183. 



Boys. Right of fathers over life and 
death of sons abolished, 104. Boys 
and girls inherit equally, 105. v. 
Children 

Bread. Its cost in time of Charle- 
magne, 251. V. G}'ain and Corn- 
laws. 

Briare (canal of), 273, 277. 
Bridgewater (Duke of). His canaliza- 
tion, 430. 

Bristol (City of), petitions against 
peace with U. S., 432. Subsequent 
petition for increase of harbor, 432. 

Broggia. Writer on moneys, 261. 
On theory of taxation, 523. 

Bruges. An entrepot of great impor- 
tance to the Hanse, 154. 

Buchholz, 532. 

Buckle, quoted on reciprocal benefits 
of commerce, 445, n. 

Budget, of Florence, 192-4, Of Ven- 
ice, 204-5. Of France under Sully, 
267. Importance of budgets, 542. 

Bullion. V. Money and Gold and 
Silver. 

Cabarrus, Spanish writer on polit. 

econ., 527. 
Cambon. Works on finance, 421. 

Method of dealing with public 

creditors, 422, 423. 
Cameral Sciences, (Polit. Econ. a 

union of), 531. 
Canada, colonized in time of Louis 

XIV, 297. 
Canal — Planned by Charlemagne, 114. 

C. of Briare, 273, 277. Of Langue- 

doc, 290. Of Bourgogne, 296. C's., 

539, 547. 
Canalization, 430. 

Caninian Law, restricted the emanci- 
pation of slaves, 62. 

Capital — attacked, 265. Not limited 
to gold and silver, 381 451.. A. 
Smith's .conception of, 381. J. B. 
Say's, 451. Moral capital, 388, 
520, 446-7, 487. National c, 545. 

Capital punishment, rare among Bar- 
barians, 89. 
Capitularies of Charlemagne, 109-I16. 
Carli, Writer on moneys, 261. 



566 



INDEX. 



Carthage. Its marine, 49. Contests 
with Rome, 50. Its superior civili- 
zation and economic effects of its 
fall, 51. 

Cattle and farming implements pro- 
tected by Sully, 267. Cattle as 
money, 250. 

Cayenne, colonized, 297. 

Celibacy, at Rome, 56. Required of 
clerks in Hanse trading-houses, 152. 
Among workmen in trade corpora- 
tions, 187, 1S8. Its economic value, 
188. Discouraged by Colbert, 289. 
Ideas of Malthus on c., 396-7. Of 
Ortes, 524. 

Cellini (Benvenuto), a goldsmith, 250. 

Cemeteries, restored to Jews, 137. 

Charlemagne. His economy, 6, no, 
107-116. His capitularies, 109 et 
seq. Power of Church under C, 
117. Solicitude for slaves, 115. 
AttemTpts a.t a maximum, 1 14. Pro- 
vision for commerce, 114. His 
revenues, 113, 114.. Hereditary 
transmission of benefices, 116. 

Charles V., Economic results of his 
reign, 209-218, monopolies, 210- 
211, restrictions and prohibitions, 
debased coin, slave trade, convents, 
inquisition, etc., 212, et seq. 526-7. 

Child (Sir Joshua), ideas on commerce, 
300. 

Children at Athens, 12, 15. C. of sol- 
diers at Athens, 15.- C. in Sparta, 
26, 27. At Rome, 63. Acquire 
legal right to their own lives, 104-5. 
Abandonment of, punished, 104. 
Division of property among, 89. 
Right of inheritance, 104, 501, 503. 
Schools for c. , 192. Considered a pos- 
session, 32, 300. C. of Spanish colon- 
ists in America, 2x5. In manufacto- 
ries, 466, 475, foot-note. Their ed- 
ucation, 423, 519-20. Malthus on 
c. , 396-7, 401. Foundlings, 294, 
397. 545- Views of some St. Simo- 
nians, 502. Fourier on, 509, 515. 
Owen on, 519. Hours of labor 
for, 544. 

Christianity, First appearance, 72. 
Became State religion, 73. Its 
services to Polit. Econ., 77-86. 
Decline of, 84. Present standard 
bearers inadequate to their task, 85, 
478, and foot-note. See Priests, 



Convents, Chttrch, Religion, Refer- 
mation. 

Christian Polit. Econ., by Villeneuve- 
Bargemont, 407. 

Church. Its services to Polit. Econ., 
78-83, 215. Its relation to politics, 
78. To slavery, 250. Its property 
in time of Charlemagne, 114, 1 15. 
Its power under C, 117. Opposed 
by barons, 130. By bourgeois, 
158. Unites with sovereigns and 
lords against bourgeois, 158. Sale 
of ch. property, and economic re- 
sults, 221, et seq. Property seized 
by Henry VIII, 265. Natural pro. 
tector of ecclesiastical demands, 
157. Struggles to maintain its 
privileges, 212. Reform of, de- 
manded by Owen, 517. V. Priests. 

Cicero. Interest of money in his 
time, 50. Exactions of procon- 
suls, 66. 

Circulation of money. At Rome, 62. 
Jews make first attempts at, 145. 
Its simplest laws not understood, 
174. Amount of, difficult to estimate, 
246. Writings on, 352. C. of U. 
S., 348. C. at Bruges, 154. A. 
Smith's analysis of, confirmed by 
experience, 455. Advantages of 
monetary circulation, 455. A uni- 
versal medium of c. proposed by 
Scaruffi, 522. v. Money. 

Citizenship, jealously guarded by the 
Athenians, 10. 

Claudian Law (ordered gratuitous dis- 
tribution of grain), 63. 

Clearing House (London). An econo- 
my in use of money, 249, foot-note. 
A universal C. H. anticipated, 259. 

Clergy, power of, 78-82. Power given 
them by Ripuary Law, 96. Influ- 
ence over lords, 96. To-day un- 
equal to their task, 84, 478. Re- 
minded of their duty, 85. Censured 
by Charlemagne for vices, 112, 113. 
Administer justice, protect widows, 
orphans, etc., 130. League against, 
by barons, 130. Their real-estate 
in time of Henry VIII, 221. Seized, 
265. Condemn loans at interest, 
105. Forbidden to take usury, 
113- 

Cleruchi^ (v. Kleruchise). 

Clothing. Of Romans, 5, 56. In Ger- 



INDEX. 



567 



many, 225, foot-note. Of silk- 
weavers of Lyons, and canuts. xii, 
Intro. 

Coal, (increasea production) 430. 

Cobbett (Wm.) Attacks abuses of 
paper money, 456, and note. N. 
24, Appendix. 

Code. Of Justinian, 103. Of Charle- 
magne, 109 et seq. Black c. 297. 

Coffee, 262. 

Coin. Of Athenians, 20, 22. An- 
cient writers on, 20. Debased, at 
Rome, 65. Ordinances on royal 
and seignorial c's., 165—167. P'or- 
eign c. prohibited, 173. Copper, 
ditto, 173. Alterations in coin, 
167, 173, 174. Legislation about 
c, 173. 174. C. debased by Charles 
V, 213. Old copper c. in France, 
245. Folly of debasing coin, 260. 
Use of coin prohibited by Constitu- 
ent Assembly, 422. Governments 
debase coin, 446, Recoinage, 119, 
note, 250, 341. Coinage at Milan, 
207. Bill of exchange preferred to 
coin, 259. V. Money. 

Colbert. Ministry of, 279-304. Had 
a system, 279. Favored private 
fortune, 280. Revised tariff, 280, 
283. Encouraged commerce, 282- 
3, 286-8 ; manufactures, 284 ; 
navigation, 285 ; marriage, 289. 
His various services to France, 292 
et seq. C. a reformer, 298. Ex- 
clusive system erronously attributed 
to him, 284, 287, and note, 299, 
305. His real aim, 283, 284. Ideas 
on money, 307. 

Colonial system. In Greece, 44 et 
seq., 229. Origin of, in Europe, 
133. C. S. of Spain, 229-233. Of 
other countries, 233-235, Nature 
and effects of, 235-238 : 240 et seq. 
433. Its great error, 238 et seq. 
Its fall foreseen by Genovesi, 523, 
Still exists, 537. 

Columella, deplored condition of agri- 
culture, 55. 

Commandite, n. 16, Appendix, 490, 
338. 

Commerce. Of Carthage, 49. Rome, 
49, 58, 65, 67. Promoted by cru- 
sades, 131, 147. Of Jews, 142. 
Of Hanse towns, 147-155. Of Ital- 
ian Republics, 195-6. In grain. 



168 et seq., 212, 368. Of Venice, 
197 et seq. In moneys, 167, 173, 
174. C. a political power, 154. 
Infractions of laws of, 168-173. C. 
favored by Colbert, 282, 283, 292- 
296. C. favors increase of values 
more than agriculture, 355. Rous, 
seau on c, 411 et seq,, 417. Com- 
mercial solidarity of nations, 79, 
445, V. Solidarity. McCulloch, au- 
thor of Dictionary of Commerce., 
462, foot-note. 

Commercial Companies (in France, 
under Louis XIV, 297. 

Commercial inter-dependence, 433. v. 
Solidarity. 

Commercial reform. Follows famines, 
at Rome, 65, v. Commerce. 

Commercial law of maritime nations — 
its origin, 150. 

Commercial treaties, tempered rigor 
of tariffs, 300. 

Commission-trade (origin of), 153. 

Communes, allusion to 7. Growth 
of their franchises, X57-9. Differ- 
ing from municipal franchises, 161. 
Gov't acts relating to, 162. Af- 
ranchisement of, 161-163. Sim- 
ultaneous establishment of, 163. 
Emancipated, 177. Budget of Com- 
munes, 542. Commune of Paris 
(asking for a maximum), 427. St. 
Just, orator of, 427. 

Community of property. Advocated 
by Plato, 32. Rejected by St. Si- 
monians, 501, 503. Fourier's' ideas 
of, 512-13, Owen's, 516. 

Community of wives. In Sparta, 28. 
Advocated by Plato, 32. Rejected 
by St. Simon, 501. Adopted by 
some St. Simonians, 503. 

Community of children, in Sparta, 27. 
Recommended by Plato, 32. 

Community life, created monasteries, 
81. 

Competition. Of slave workmen at 
Rome, 54, 56. . Ceased, 63. C. not 
yet secured, 189. Did not disturb 
trade corporations, 188. Origin and 
effects of universal c, 389. Un- 
limited c. advocated by A. Smith, 
442. Its evils shown by Sismondi, 
469-471. Unlimited c, 536. C. 
limited by monopolies, 537. 



568 



INDEX. 



Comte (Chas.) His Treatise on Leg- 
islation quoted on slavery, 480. 

Concubines, allotted to Roman gover- 
nors, 75. Concubinage proscribed 
after introduction of Christianity, 
78. 

Condillac, 378. 

Conditionales tributarii, 122. 

Condorcet, 376, foot-note. 378. 

Confiscation of Ecclesiastical Proper- 
ty, 221, et seq., 265. 

Constantinople, true cradle of Christ- 
ianity, 74. C. under Justinian, 
101-106. 

Constituent Assembly. Ideas on tax- 
ation, 361. Their tariffs, 423. Es- 
tablished a maxiimim, 422. Made 
citizens and departments equal be- 
fore the lavi^, 369. Other reforms, 
419, et seq. 

Continental Blockade, 424 et seq. Its 
service to French industries, 439. 
Effect on Eng., 439. On other 
powers, 440. Gave rise to smug- 
gling, 310, 439. 

Contrabandage, ) against Hanse 

Contraband Trade, [monopoly, 151. 
Contributed to solution of economic 
questions, 218, 309 et seq. Sully's 
severity against, 269. Rousseau's 
plan to prevent, 414. A result of 
Continental Blockade, 439. A re- 
sult of competition, 469. 

Contraction of the Currency, v. Ap- 
preciation of Money. 

Convention (National), rejected foreign 
commodities, 168. Passed law for 
maximum. 173,426. Prohibited im- 
portation of undi'essed leathers of 
Spain, 312. Beneficial measures of, 
421-423. Had narrow ideas on 
commercial questions, 423. At- 
tempted to solve social questions, 
408. Punished with death the re- 
fusal to take paper money, 349. 

Convents, Origin of, 8r. Benefits, 
82, gr. Multiplied and endowed at 
the expense of agriculture and labor, 
215. Their suppression and its 
economic results, 221-224 et seq., 
265-266. Results of their multi- 
plication in Spain, 526. 

Cooperation of laborers necessary for 
their improvement, 484. 



Corn (grain) Laws. At Rome, 64. 
In France, 168-173. Export of g. 
prohibited, 212. Poor-tax a cause of 
maintenance of c. 1. in Eng., 424. 
C. 1. attacked by Col. Torrens and 
Ricardo, 461. Effect of c. 1. on 
workmen, 439, v. Prohibition. 
Corporations — their origin, 82: 178, 
note. Their organization under St. 
Louis, 178-184. Effect upon la- 
borers, 183-188. Devoted to liber- 
ties of the Communes, 161. Abol- 
ished by Constituent Assembly, 420, 
535-6. Attempt to restore in 1815, 
450. 
Corvees, 60, 67 and note 8, App., 68, 
122, 247, 360, 364, 372, 375, 413. 
Suppressed, 371. 
Cost of living. At Athens, 17. In 

Eng., 353-4 and foot-note. 
Cotton, 262, 323, 431, foot-notes. 

Goods of, sent to India, 431. 
Councils, of prud'hommes, 296 and 

foot-note. 
Courcelle Seneuil, quoted on bill of 

exchange, 141, foot-note. 
Credit. At Athens, 6, 18, 21, 22. In 
Sparta, 26, 27. At Rome, 50. 
Claimed by lords from bourgeois, 
i6r. Of Jews, 145. Limited by bour- 
geois to bishops, 161. In Italian 
Republics, 196,203, 206-7. Abuses 
and services of credit, 326, 329- 
332, 455. Credit as capital. 326. 
Limitations of, 349 and note. Pub- 
lic credit in France — debt funded, 
423. Public credit in Eng. in con- 
tracting gov't loans, 436-7. Public 
credit opposed by Turgot and the 
Economists, 374. Writings on c. 
352, 455- Jn. Law's ideas on c. 
335. Science of public c. in Con- 
stituent Assembly, 423. C. of mod- 
ern nations, 546. v. Banks. 

Crusaders. Of whom composed, 126. 
Immunities of, 126-7. Means of 
obtaining money for, 128-9. Food 
of, 129. 

Crusades, 125-133. Effect on Navi- 
gation, manufactures and commerce 
of Hanse towns, 147 et seq. Gen- 
eral economic results, 125. 

Crusades against Jews, 143. 

Currency. Tooke on Currency, 463 



INDEX. 



569 



and foot-notes, v. Money and Cir- 
culatioti. 

Custom-duties. At Rome, 6, 52-3, 
65-6-8. At Athens, II. Of the 

, Hanse, 152. In Eng., 154. Of 
Venice incre.7,'5£d by Chas. V, 201. 
First wars oi, 200. In France, 
271, 425, 440. Of Constituent As- 
sembly, 421. Interior customs abol- 
ished, 536. Customs of Valence (or 
Vienne), 270-1, 274, 281. 
Custom houses, 425, 440. 

Daire (Eugene). Reedited the works 
of Turgot, 376, foot-note. Author 
of Historic notice of yohn Law, his 
tuntings, etc., 345, foot-note. 

Dallarde. Left works on economic 
subjects, 421. 

Danton, quoted, 427. 

Danvila, (Spanish Economist), 527. 

Dareste de la Chavanne, 123, foot- 
note. 

Daru (Count), cited, 197, foot-note. 
Quoted on History and Co??tmerce of 
Venice, 191, 199. On budget of 
Venice, 204. 

Davanzati, quoted on gold and silver, 
260. 

Uebt. Treatment of debtors at 
Athens, II, 12. Debtors at Rome, 
62. Debt of France in time of 
Sully, 267, 277. Nat. Conv. pro- 
claim education a national debt, 
423. Funded and floating debt of 
Eng,, 437. Debt of Eng., 436-7, 
440, note on p. 436. Public 
debt of France funded, 423. Pub- 
lic d's of modern nations, 546. 

Decentralization of Roman power, 74. 

Decurions, responsible for taxes, 74. 

De Laborde (Count) on Spirit of As- 
sociation, 489. 

Delos, temple at, lent money entrust- 
ed to it, 22. 

Delphi, temple at, lent money entrust- 
ed to it, 22. 

Demosthenes, won his first case, 
against his guardians, 15. 

Depreciation of money, 247, 252-257 
and foot-note. From excess of pa- 
per issues, 341, 348, 438-439. 



Destutt de Tracy (Count), Refutes er- 
rors of Montesquieu on trade, 411, 
foot-note. 

Discovery of mines of America. 

Economic results in Europe, 256- 

257 and foot-note. 261-2, 263, et 

seq. 
Distributions (to populace). At 

Athens, 12, 15, 16, 17, 18. At 

Rome, 63, 64, 247. 

Division of Labor. Illustrated by 
Plato, 29, 30. Effected by trade- 
corporations, 181. Among Dutch 
cities, 315. Shown by Turgot in 
his " Treatise, etc.," 377. Illus- 
trated by A. Smith, 382. Analyzed 
by Algarotti and Beccaria, 523. 

Division of lands, a consequence of 
Law's system, 349, 351. Of crusa- 
ders, 393. Aided by the assignats, 
421. 

Division of profits of labor. Xeno- 
phon's ideas of, 35. Growing im- 
portance of the problem, 533. 
Dunoyer and Dro7, on the subject, 
484. 

Divorce. Under laws of Justinian, 
104. 

Doctrines, decided by force, 99. 

Droz (Joseph). Doctrines of his 
Econ. Politique, 479, 484. On co- 
operation of laborers, 484, 

Duchatel. His work on " Charity," 
407, 408. 

Duelling. Origin of, 96. Questions 
of doctrine decided by force, 99. 

Duke of Bridgewater. His fine at- 
tempts at canalization, 430. 

Dulary. Referred to on Owen, 513, 
foot-note. 

Dunkirk, made a free port by Colbert, 
297. 

Dunoyer, quoted on the slavery of the 
useful occupations, 34. His treatise 
on Social Economy, 480. Doc- 
trines, 4S1-484. 

Dupont de Nemours. Author of 
Physiocratie, 356. Quoted on the 
Tableau Economique, 357. A fol- 
lower of Quesnay, 364. Collated 
and published the writings of Tur- 
got, 376 and foot-note, 369, foot- 
note. 



570 



INDEX. 



Dupre (de Saint-Maur). Fr. writer 
on moneys, 261. 

Dutch. Their shipping, industries, 
and prosperity under free-trade, 
314—15. Measures adopted to ex- 
clude competition, 316. Regain 
Java, 440. Became proliibitionists, 
299. 

Duties. (Import and export). v. 
Custom duties and Taxation. D. 
(differential), imposed by France, 
333. On colonial sugars, 450. 

Dutot. Writer on Law's system, cit- 
ed, 345- 

Dwellings, of Spartans, 28. Of Ro- 
mans, 56, 57. Of French peasants, 
224, 549. Erasmus quoted on, 224. 

East India Co., established under aus- 
pices of Colbert, 297. Abolition of 
its privileges, 316 and foot-note. 

Ecoftomics (Xenophon's), 19, 33, 35, 
36. 

Economists (School of), 352-365. 
Founded by Quesnay, 352. Doc- 
trine of ttet prodtict, 353—4. Of 
taxation, 354. Method of promul- 
gating their doctrines, 363. Charac- 
teristics of, 364, 365. Method of 
procedure, 379. Rendered task of 
A. Smith difficult, 387. Their fun- 
damental error, 354, 361. Transit 
lines due to them. 369. Opposed 
public loans, 474. Differences of 
doctrine among them, 364. Their 
principal writers and disciples, 352, 
364. Compared with A. Smith, 
380. Reasoned better than the phi- 
losophers, 417. Their work, 529. 

Edict of Nantes. Its economic re- 
sults, 225. Revocation of, 298, 
299. 334- 

Edict of Piste, 119 and foot-note. 

Education. Of women and children 
in Sparta, 27. At Athens, 15. In 
Italian Republics, 192., Of children 
of Spanish American Colony, 215. 
Proclaimed a national debt, 423. 
Fourier's idea of, 515. Owen's, 
519-20. Importance of, 520. In- 
dustrial, 294. 

Elgin (Lord), 12. 

Eloi (Saint), 250. 

Emancipation of blacks. (To whom 



due, 408, 428. Of Eng. and Span- 
ish Colonies of America, 428. Of 
woman, 499, 502. Of laborers, 505. 
Emigrant loan, 450. 

Encyclopedists, [362,409, 

Encyclopedic Philosophers, f 417, 
(compared with Economists'), and n. 
18, Appendix. 

Entail. Abolished in French Revo- 
lution, 535. Attempt to restore, 
450. 

Entrepots, 141, 150, 153, 226, 286, 
312, 538, 544. 

English School (of Polit. Econ.) Its 
characteristics, 529-531. 

Epernon (Duke of) resisted Sully, 267. 

Equal Rights, inculcated by Christi- 
anity, 77. 

Eranos. A Society of Athens, 15, 16. 

Erasmus, quoted on houses of work- 
ing people, 224. 

Esterlings. Whence sterling money 
derived its name, 155, notes. 

Estrada (Florez).' His Eclectic Course 
of Polit. Econ., 492. His excellent 
treatment of taxation, rent, paper- 
money, banks, etc., 492-3, 527-8. 

Everett (Alexander). Amer. Econo- 
mist. Effect of population on pro- 
gress, 405. 

Exchange (bill of), 141— 144, note. 
Mechanism of exchanges, 451. 

Exclusive System, 174. Invented by 
Italians and honored by Spanish, 
201-2. Evil effects of, 202, 426. 
Erroneously attributed to Colbert, 
284, 287, 299, 305. Discarded by 
Gournay and others of his school, 
364. Advocated by prominent 
writers, 445. Overfhrown by J. B. 
Say, 445. Now advocated by no 
economic school, 534. v. Prohibi- 
tion, Protection, Free trade. 

Exemption of church property from 
taxation. Opposed by kings, 157. 
By barons, 130. E. removed, to 
relief of tax-payers, 227. 

Exploitation of men, 7, 10, 2:4, 479. 
Of mines, 6, 19, 246, 546. Of the 
country by collectors of the revenue, 
267. Of lands, 51. 

Export. Of grain, prohibited by Chaj 



INDEX. 



571 



iemagne, 114; by Phillippe le Bel, 
166, 168, 172 ; by Chas. V, 212. 
Free export of grain allowed by 
Turgot, 367-8. Export of money 
at Rome, 55, 67. Export of money 
prohibited, 166, 174, 266, 269, 299, 
526, 311. Views of writers on, 300. 
Of Genovesi, 301, v. Ccr«-/awj and 
Moftey. 

Famines. At Rome, 64-5. Among 
Crusaders, 129. None in Holland, 
314- 

Fecundity, encouraged by law, 62, 
289. Discouraged by Malthus, 394 
et seq., 485. 

Females. In Sparta, 27, 28. Aris- 
totle quoted on inferiority of, 38. v. 
Women. 

Fenelon. troubled by the unjust dis- 
tribution of taxes, 303. 

Feudalism. Its origin, 116, T17. Es- 
tablishment, social conditions, and 
economic results, 11 7-1 24. Modi- 
fied by Crusades, 133. Compelled 
by Hanse towns to respect labor, 
155. Existing traces of, 123. 

Fiefs. Origin of, 116. 

Filangieri. On free trade and stand- 
ing armies, 524—5. 

Finances. In Greece, 11, 12, 23. At 
Rome, 66, 67. First budget in 
France, 267. Recherches sur les 
finances, by Forbonnais, quoted, 
267. In Eng., 434. Monetary 
systems, 242 et seq. v. Aloney, 
Cusioni Duties, Mercantile Syste?ji, 
John Lazu. 

Fines. At Athens, 11, 12. 

Fisheries, created by Hanse towns, 
155. Affected by Prot. Reforma- 
tion, 226. 

Fleury (Cai-dinal). Administration of, 
448, foot-note. 

Florence. Budget of, 193-4. Indus- 
trial arts of, 190. 

Food. At Athens, n. p. 18. At 
Sparta, 28. Of masses at Rome, 
56, 57, 63. Of crusaders, 129. 
Monopoly of, at Byzantium, 133. 
Circulated freely in Mediterranean 
and maritime cities, 133. Of peas- 
ants in France, 224. Cost of, in 
time of Charlemagne, 251. (v. 
Corn-laws and Grain). 



Forbonnais (1756— 1771). Views of, 
on export of money, 300. Wrote 
exposition of Law's System, 345. 
Quoted on financial administration 
of Sully, 267 ; of Colbert ; 298 ; on 
customs of Vienne, 271. 

Force, employed to decide questions 
of Christian doctrine, 99. 

Forests, a legal asylum, 89. 

Fortescue, on condition of French 
peasantry, 224. 

Foundling Asylums, 294 and foot- 
notes, 397 and foot-note, 545. 

Fourier (Chas.) His Societary Sys- 
tem, 508-516. Turns to children, 
515. Compared with Owen and 
St. Simon, 509. 

Frameas, 88 and n. 9, Appendix. 

Franchises. Of Hanse towns, 147. 
Of cities, 158. Of Communes, 
161 (v. Communes.). Distinction 
between commercial and municipal, 
i6r. 

Fraternity among nations, taught and 
developed by Mercier de la Riviere, 
360. 

Freedom, of investigation. Its con- 
nection with Protestantism, 218, 
226. Of labor, 5, 425. Restricted, 
272 (v. Labor.). Personal f., 92. 
Civil and religious, 417. Commer- 
cial f. , 417. (v. free-trade^ 

Freeholders, become feudatories, 123. 

Free-Trade. In Hanse towns, 150. 
Violated by Philippe IV., 170. In 
Italian Republics, 191. Prosperity 
of Venice due to, 201-2. Of Hol- 
land also and the Hanse, 150. 
Lyons petitions for, 271. Paris 
petitions against high tariff, 281. 
F. T. in competition with mercan- 
tile system, 314 et seq. Dutch, a 
striking example of good effects of, 
314—316. Taught by Economists, 
356 (Quesnay and Baiadeau, 359), 
and especially by La Riviere, 360, 
et seq. By Adam Smith, 355, 360, 
385; J. B. Say, 355, 444-6; by 
Turgot, in preamble to act abolish- 
ing trade-corporations, 372 ; by 
Huskisson, 309, 462 ; by Buckle 
and J. S. Mill, foot-notes, pp. 445- 
6 ; by Filangieri, 524 ; by Sir Henry 
Parnell, 465. Promoted temporari- 
ly on the continent by Continental 



572 



INDEX. 



Blockade, 425. Prejudices to over- 
come, 428. 

French Revolution, 419-430. Its So- 
cial reforms, 419, 423. Its effect 
on labor, 425. Its tariffs, 423. Re- 
action of, on financial system of 
Eng., 434-5. Lessons of, 428. 

French School of Polit. Econ., 390, 
528-9. 

Froumenteau, quoted on finance, 254. 
On condition of France under Hen- 
ry III., 264. 

Funded debt. v. Debt. 

Ganilh (Chas.). Quoted on moneys 
of Italy, 213. His writings and 
contributions to financial science, 
489. 

Genoa. Prosperity of, 206. Bank of, 
206-7. First example of exclusive 
privileges on payment of subsidies, 
207. 

Genovesi. Opposes export of specie, 
301. Represents Italian school, 523. 
Reforms he advocates, 523. 

German Econ. School. Characteristics 
of, 531-533- 

Gilbart (Jas. W.) Author of Hist, 
and Principles of Banking, cited 
on Bk. of St. George, 207. An act 
establishing Bk. of Eng., 320, foot- 
note. 

Gioja (Melchiorre). His works and 
tlieir characteristics, 525. 

Girls. Education of, at Sparta, 27, 
28. No dowry, 26. Inherit equally 
with boys by Institutes of Justinian, 
105. (v. Children^ 

Glut of markets. Say's explanation, 
450-1. 

Godwin (Wm.) Doctrines and works 
of, 391, 393, et seq., 402-404. 
Quoted, 404-405, 485. Godwin's 
theory represented in Italy by Vas- 
co, 524. 

Gold, Roman taxes paid in, 75. 

Gold and silver. At Athens, 19-21. 
At Rome, 49, 55, 67. Export of, ■ 
prohibited, 166, 174, 266, 269, 299, 
526, 311. Causes that make them 
go from one country to another, 311. 
Relative value of, 21, 119. Pro- 
duction of mines, 257. Why value 
did not depreciate, 252. Ideas of 
Spanish upon, 526. (v. Money.) 



Goumay. Doctrines and works of, 
353. Author of adage, " Laissez 
/aire," 364. An honored name, 
387. 

Government responsibility for social 
evils, 428, 393, 485. 

Government intervention (in indus- 
trial affairs), reprobated by J. B. 
Say, 448, 449, 452. Changed views, 
532. 539- 541- 

Government works, (v. Public works). 

Grain laws, (v. corn-laws). 

Greece. Her Polit, Econ., 10-46. 

Grote, quoted on Perikles and the 
Athenian Democracy, 13 et seq. 

Guibert (Abbe), quoted on " Com- 
mune," 156. 

Guarinos (Sempare y), 527. 

Guizot. On maximum in time of 
Charlemagne. 112. On heredity of 
fiefs, 118. On increase in number 
of communes, 162. On inefificacy 
of religion, 478. 

Hanse League, 143-155. Origin, 147- 
8. Effect of crusades on, 147. 
Peculiar organization of their fac- 
tories, 151. Entrepots of, 151-2. 
Commission trade, 155. Services 
to Polit. Econ., 155. List of Hanse 
towns, 149, foot-note. 

Hauterive (D'). Quoted on theory of 
prohibitory laws, 319. 

Heeren. Quoted on influence of cru- 
sades on supplies of food, 133 

Helots, 29. 

Heredity, taken from patriarchate of 
Constantinople, 74. H. of fiefs, 
origin of feudal system, I16. (v. 
Inheritance..) 

Henry IV, (France under), 528. 

Herman (Prof.) 532. 

Hincmar (Archbishop), on Assemblies 
of Charlemagne, log. 

Holy days, secularized, 221. Econ, 
results, 224-5. 

Hospitals. Under Justinian, 102. In 
Italian Republics, 192. In Nether- 
lands, 222. (v. Foundling Asylums.) 

House of Refuge, established at Paris, 
293. In Netherlands, 222. 

Houses of working people in Ger. 
many, in time of Erasmus, 224. 



INDEX. 



573 



Huskisson (Wm.) On charges for as- 
saying precious metals, 259. Aim, 
same as that of Colbert, 280. Quo- 
ted on prohibition, 309. On Navi- 
. gation Act, 317. Inaugurated tariff 
reform, 318, foot-note. His reforms 
and speech on the same in Parlia- 
ment (quoted), 462-3. Speech on 
England's maritime claims, 464. 
Compared with Henry Parnell, 465. 
His impartial and prudent zeal, 494. 

Immaterial products, their economic 
value demonstrated by J. B. Say, 
447-8, foot-note. By Adam Smith, 
388, foot-note. 

Imposts. At Athens, farmed out 
to contractors, 11. At Rome, 52, 
65 et seq. Montesquieu quoted on 
superiority of tax on commodities 
over poll-tax, 410. Weight of i. in 
Eng. thrown upon labor, 434. (v. 
Taxation.) 

India Companies, established under 
auspices of Colbert. 297. v. East 
I. Co. and West I. Co. 

Industrial development, illustrated by 
Plato, 31 ; i. and commercial civil- 
ization of Carthage, 50 ; i. corpora- 
tions, originated in convents, 82. 
(v. Corporations) ; i. rights protected 
bylaw, 417; i. war, 425 ; i. statis- 
tics, 544. 

Industries. At Athens, 11. Sparta, 
28. Rome, 48-9, 55-6, 58, 63-4. 
Carthage, 50. In monasteries, 82. 
Among Barbarians, 95, 97. Organ- 
ized by Boyleau, 177-189. Impor- 
tance in Italian Republics, 190-20S. 
At Florence, 190. Sienna and Ven- 
ice, 191, 197, et seq. Retarded by 
prohibition and monopoly, 201-2. 
Injured h-^ restrictions of Charles 
v., 211— 213. Colbert's efforts to 
improve, 294. Effect of Continental 
blockade on i. of Europe, 425. 
England's i's, 430 et seq. : J. B. 
Say on their effects, 447. Sismondi 
on, 468 et seq. 

Inheritance of property. Among Bar- 
barians, 89. Admitted principle in 
Institutes of Justinian, 105. Gradual 
abolition of, advocated by St. Simon, 
501 ; by Owen, 516 ; by Vasco, 524. 

Institutes of Justinian, 74, 103-105. 



Instruction. Free at Athens, 15. 
Treated of by J. B. Say, 532. 
Moral, religious and industrial in- 
struction recommended by Ville- 
neuve Bargemont, 478, 505. (v. 
Edticatioti). 

Insurrection, at Lyons, 2 and note. 

Interdependence of nations, 433, 445. 
(v. Solidarity). 

Interest of money (rate of). In 
Greece, 21, 22. I. in advance, 21. 
At Rome, in time of Cicero, 50. 
As fixed by Pandects, X05. Differ- 
ent for different classes in society, 
105. Habitual to all classes, 113. 
Prohibited by Capitularies, especial- 
ly to clergy, 113. Always con- 
demned by clergy, 105. Suppressed 
by Louis VIII. , 167. Rate of i. 
not dependent on volume of money, 
347. Effect of r. of i. on enterprises, 
373. 377- Legislation on rate of in- 
terest opposed by Turgot, 373 ; by 
Jeremy Bentham, 373. I. brought 
back to a single rate, 423 

Inventions — their economic results, 7. 
Printing, 225. Spinning-frame and 
steam-engine, 430 et seq., 434. I's 
simultaneously adopted in different 
countries, 400. Patents secure 

rights to, 420—1 

Iron, increased production of, 430. 

Isocrates, quotation from, shows prim- 
itive form of bill of exchange, 142, 
foot-note. 

Italian Republics. Their importance 
to Polit. Econ., 7, 190-208. Their 
industries, commerce and revenues, 
etc., 190-200. Decline begins with 
protection, 200-202. 

Italian tradesmen, ordinances against, 
in France, 165. 

Italian Economists, their characteris- 
tics, 525-6. 

Jacob (Wm.) Quoted on production 
and consumption of precious met- 
als, 247-8. 

Jerusalem. Assizes of, 131, and n. 
10, App. Kingdom of, 251. Kings 
of, granted privileges to Venetian 
merchants, 133. 

Jesuits. Establishment of, favored 
by Chas. V., 218. 



574 



INDEX. 



Jews, 134-146. Under feudal regime, 
135. Create science of credit and 
and exchange, 7. Interdicted from 
making contracts, 136. Loaners of 
money, 137-g. Sell slaves, 140. 
Priests and bisliops tributary to 
them, [40. Ordinances against 
them, 135-137, 165, 166, 167. Per- 
secution of, prompted by religious 
fanaticism, 176. Importance of, as 
possessors of capital, 177. 

John (King of Eng.), ransom of, how 
paid, 250. 

Jovellanos (Spanish economist), 527-8. 

Justinian. (Reign of), 101-106. In- 
stitutes of, 103, 105. Code of, 103- 
106. Pattdects, I02, 103, 105. 
Novellae, 104. 



Kings, uniting with bourgeois against 
usurpations of the nobility, 158, 
159. Against usurpations of the 
church, 157. 

Kleruchise, 35. 

Krause (J. F.) Writer on Prussian 
custom duties, agriculture, territorial 
bank, etc., 532. 

Labor, how regarded by Greeks and 
Romans, 4, 5, 10, 11, 57, 63, 66. 
Under feudalism, 120, 121, 122. 
Increased respect for, 155. Restored 
to honor, 159. Restricted by French 
kings, 272. By Chas. V, 210. 
Honored in Italian Republics, 207, 
211. Effect of increase of money 
on, 254-5 et seq. Reinstated by A. 
Smith, 8. Rights of, 372. Ana- 
lyzed by A. Smith, 381. Freed by 
French Revolution 420, 423, 424, 
425. Its condition modified by ma- 
chines, 430 et seq. Iniproved con- 
dition of, 479. L. owes much to 
St. Simonians, 504. Freed by abol- 
ition of corporations, 535-6. -Profits 
of, 549. Labor-Corporations^ (v. 
Corporations). v. Division of la- 
bor, 

Laborde (Count Alexandre de). Es- 
say of, on Spirit of Association, 489, 
490. 

La Fontaine, opposed free trade, 445. 

Landed property, (v. Property.) 

La Trosne, 364. 



Laurion, Mines of, xg. 

Law (John). His system, 8, 335 et 
seq. Its errors, 347. Causes of 
failure, 348. Econ. results, 349, 
350, 528. Excellence of his "Con- 
siderations on Money," 346 and 
foot-note. 

Laws. Of Lycurgus, 25-29. Roman 
1., 62-69. Of Barbarians, 96-100. 
Of Justinian, 101-106. Of Charle- 
magne, 110-115. Effect of crusades 
on, 131. About Jews, 136 et seq. 
(v. yeivs), Of Kings of France of 
3d race, 165-176. Of Louis XIV, 
293-303. Of Fr. Revolution, v. 
Fr. Rev. and Coitvention. (v. 
Sumptuary lazvs, Money, Grain, 
Corn-laivs). L. cannot secure pros- 
perity, 428. 

Lawyers, substitute laws for the sword, 
73, 74. Exactions of, 74, 275. 
Threatened with death, 74. In 
comfortable circumstances, 301. 

League. Hanseatic L., 146-156. Of 
Smalkalde, 219. Of barons against 
clergy, 130. Of bourgeois and 
kings against barons, 158-160. Of 
bourgeois and kings against church, 
157- 

Le Blanc. Writer on moneys, 261. 

Lemontez, quoted on Law's bank, 
34S. 

Levant. Commerce of, in time of 
Colbert, 297. 

Levasseur, quoted on origin of trade- 
corporations, 178, note. 

Lisbon, closed to Dutch. Econ. re- 
sults, 226, 312. 

Literary property, v. Property. 

Loan-banks, 143-145. 

Loans, known to Athenians, 6 22. 
Provisions for, in Pandects, 104. 
Loans at interest condemned by 
clergy, 104. By laws, 139. (v. In- 
terest of inoneyi). Public loans op- 
posed by Economists and Turgot, 
374. L. under Louvais, 304. 

Forced loans, 161, 393. Emigrant 
loan, 450. (v. Credit.) 

Lotteries, suppressed, 545. 

Louis VIII. Ordinances of, against 
Jews and against interest on money, 
etc., 167. 

Louis Hutin. Ordinance of, against 



INDEX. 



J75 



Jews and against interest on money, 
167. 

Louis IX, ordinances on commerce, 
167. His ransom, 250. Corpora- 
tions, 528. V. Corpoi-atio7is. 

Louis XIV. V. Colbert. 

Louvois, 304. 

Luddists, 139. 

Luxury. At Rome, 56-58, 65-6. In 
Italian Republics, 195. • In France, 
343. Opposed by Sully, 269. 

Lykurgus (Institutions of), 25-29. 

Lyons. Insurgents of, 2, and note, 
408. Movements of specie toward, 
61. Asks for free trade, 271, The 
entrepot of Italy, 141. Bill of ex- 
change first used at, 141. 

McCuUoch, 461-2, and foot-note, 462. 

Machines, of Arlcwright and Watt, 
430 et seq., 434, 390. A. Smith's 
view of, 385. Opposed by Sismondi, 
468 et seq. Benefits from, 479, 
Evils, 429, 475 et seq., 549. 

Macpherson. History of Commerce, 
quoted on money imported into 
England by French refugees, 299, 
foot-note. 

Madagascar, colonized, 297. 

Maize, introduced into Europe by 
crusaders, 132. 

Majorats, 493, 526, 527. Abolished 
in French Revolution, 535. 

Malchus (Baron de), writer on finance, 

532. 
Malesherbes, economist of the shade 

of Gournay, 364. 

Malthus. His Principle of Population, 
393-404. Quoted, pp. 394-5-6-7, 
402-4. Was right, 469. Opposed 
Say on some points, 450. Led by a 
striking idea, 478. Attributed social 
maladies to excess of population, 
485. Views of, opposed by Scro{)e, 
465-6. Views of, represented in 
Italy by Ricci, 524. 

Mandats, 438. 

Manufactures. At Rome, 54, 63. 
Promoted by Crusades, 132. Under 
St. Louis, 178-184. In Venice, 201 
—204. In other Italian Republics, 
ao6-7. Disparaged by Sully, 169. 



Encouraged by Colbert, 284. Of 
Europe during continental wars, 
424-5, 439. M. more favorable 
than agriculture to increase of val 
ues, 355. Babbage and Dr. Ure on 
m., 466, and note. Sismondi on, 
468 et seq. Mercier de la Riviere 
on, 359. Principal demand for, in 
cities, 550. 

Marat, 403, 427. 

Marine Assurance Co. At Bruges, 
154-5- 

Marine (Merchant-) created by Hanse 
towns, 155. 

Maritime Laws. First authentic col- 
lection of, 131. 

Maritime Commerce. Encouraged by 
Colbert, 296-7. 

Markets. J. B. Say's theory of, 444 
et seq. Glut of, 451. 

Marmontel. Quoted on Quesnay, 
362. Speaks of Polit. Econ., 378. 

Mark (silver). Its nominal value rais- 
ed by edict, 253. Gold and silver 
m., 261. 

Marriage. In Sparta, 27 and 28. 
Plato on, 32. Xenophon on, 35. At 
Rome, 56. Under Justinian, 104. 
Interdicted to serfs, 122. Retarded 
by trade-corporations, 187-8. En- 
couraged by liberal wages in Span- 
ish colonies, 232. Encouraged by 
Colbert, 289. Malthus on, 396-7. 
Ortes on, 524. 

Marseilles (right of aubaine stippressed 
at), 2S5. Seized by pirates, 119. 

Matthieu, on Customs of Vienne, 272. 

Martineau (Harriet), on condition of 
Owen's colony at New-Harmony, 
517 

Mata (Martinez de la), 527. 

Mazarin, wasteful, 279. 

Maximum, for grain, at Rome, 62. 
Attempts at, by Charlemagne, 112, 
114. By kings of third race, in 
France, 165-6, 168 et seq, 173. In 
^798, 393. Adopted by Nat. Con- 
vention as a temporary measure, 
422. Effect, 422, 426-8. 

Melon, advocated prohibition, 300. 

Mendicancy. Efforts of Charlemagne 
to suppress, 112. Laws against, 
under Chas V, 222. In Protestant 



576 



INDEX. 



countries, 223. In Eng. under 
Elizabeth and Henry VIII, 265 
-66. In France, 281. Colbert's 
efforts to suppress, 281 et seq., 294. 
Under Vauban, 304. Encouraged 
by bounties, 426, 526. 

Mengotti, quoted in reference to 
movements of specie, 266, note. 

Mercantile System, 305-321. Advo- 
cated by Sully, 269. Propagated 
under name of Colbertism, 287. 
Colbert erroneously regarded its 
founder. 305. Its origin, 305. 
General adoption in Europe, 305-7. 
Evils of, 303, 306, etc., 309, et seq. 
Unsuccessful in its attempts to re- 
tain money, 311. Neutralized by 
contrabandage, 309-11. In com- 
petition with Free-trade, 314 et seq. 

Merchant-marine, created by Hanse 
towns, 155. 

Mercier de la Riviere, advocated mon- 
archical government, 358-9. On 
miseries of the manufacturing class, 
360. Less eloquent than Rousseau, 
417. 

Mennais (La), complains of both work- 
men and masters, 408. 

Metallurgy. In Greece, 20. 

Middle class, the surest basis of a social 
organization, 41. 

Milan. Development of business and 
demand for money at, 207. 

Mill (Jas.), 461 and foot-note. 

Mill (J. S.), quoted on free-trade, foot- 
note, p. 446. 

Mines. Of Attika and Laurion, 19. 
Of Romans, 247. Of America, 230, 
231, 233, 252-262. Humboldt's es- 
timate of product of Amer. mines, 
257. Diminished production, 258 
and note. Some bad consequences 
of discovery of Amer. mines, 263 et 
seq., 266. 

Minors. Their rights at Rome, 78, 
104. 

Mints. (Great number of). At Milan, 
in T3th century, 207. 

Mirabeau, Marquis de ^che elder). 
His A7ni des Homines (Friend of 
mankind), or Treatise on Popula- 
tion, 363. Follower of Quesnay, 
364. His works, 421. 



Miromesmil. Dialogue of, with Tur- 
got, on the roads, 369-371. 

Monasteries — See Convents. 

Money. Plato's definition of m., 31, 
Aristotle's definition 242. Xeno- 
phon's explanation of functions of 
m., 242. Cause of value of money, 
according to Aristotle, 39. Proper- 
ties of money, 39, 40, 243. Gold, 
silver and billon m. in Greece, and 
relative values of gold and silver. 
20-22. Ancient writers on m. , 20. 
Temple at Delphi a bank of deposit, 
21. Interest of m. in Greece, 21. 
Iron m., 22, 245. Copper m. at 
Rome, 48, 245. Permanent export 
of m. at Rome, 55, 67. Gold m. 
used at Rome for taxes, 75. Penal- 
ties for counterfeiting, under Char- 
lemagne, 114. Recoinage of m., 
119, note; 174, 250, 341. M. 
passes into hands of Jews, 139. 
Sterling m. (origin of name), 155, 
foot note. Copper m. in France, 
prohibited, 173. Export of m. 
prohibited, 156, 174, 266, 269, 299, 
311, 526. Ordinances on royal and 
seignorial coins, 165-167. Substi- 
tutes forg. and s. m., 245-6-7-9—50. 
M. not invariable in value, 244. 
Advantages of g. and s. m., 245. 
Monetary systems until discovery of 
New World, 242-262. Difficult to 
estimate amount of m. in circula- 
tion, 246. Effect of quantity of m. 
on prices, 247, 252-258. Appreci- 
ated m., 248-252, 257. Depreciated 
m on ey, 24 7 , 2 5 2-2 5 9 . Living motiey 
in Eng., 250. The silver pound, 
251. Effect of crusades on m. of 
Europe, 251. Italian and French 
writers on m., 260, 261. Debased 
m. in France, Holland, Venice and 
Florence, 260. Efforts to retain 
money, 266 ; by Sully, 269 ; by 
Colbert, 299. In various countries, 
311. Mengotti quoted on move- 
ments of specie, 266. Colbert's 
ideas on m., 307. Law's ideas on 
money, 335 ; in "Considerations on 
Money," 346. Paper m., — when it 
expels other m., 311. "Bank- 
money," 334, 325. Paper m. sub- 
stituted for coin, 325. Paper m. 
used by Eng. for 24 years, 331, and 
n. 22, Appendix. Ricardo's idea 

' of the true condition of m., 2SQ. 



INDEX. 



577 



332. Paper m. in French Revolu- 
tion, 249, 422. Paper m. of Law's 
bank, 337-349 ; Disturbed monetary 
system, 344-5. A. Smith on bank 
bills and paper m., 383. Excessive 
issue of Bk. of Eng. bills, 438. 
Appreciation of money in resump- 
tion of specie payments in Eng., 
439, Governments debase coin, 446. 
J. B. Say on moneys, 446. Advan- 
tages of monetary circulation shown 
by Thornton, 455. Paper m. and 
m. paper, 478. Export of money 
from Eng. to pay coalitions, 455. 
Export of m. prohibited in Spain, 
526. See Interest (rate of), Coin, 
Banks. 

Money-changers. In Greece, 20. In 
Europe, v. Jews. 

Monks, privileged by Charles V. to 
beg, 222. Secularization of m. in 
England, 221-3. In other Protes- 
tant countries, 223 et seq. 

Monopoly. At Rome, 64, 65. Under 
Justinian, loi. Forbidden by Char- 
lemagne, 114. Of Hanse towns, 
151. Of colonial trade, 234 et seq. 
240. Of Venice, completed her 
ruin, 281. Of ocean transport by 
Eng., and other m's, 315-317. Of 
France, 542. 

Montesquieu. On trade, 362, 445. 
His rank as a publicist, his Spirit 
of tJie Lazvs, &c. , 409-413. Quoted 
on poll tax and commodity tax, 410. 
On slavery, 410, 411. On com- 
merce, 411-12. His works the 
arsenal of all philosophical, econo- 
mic and political parties, 412. Com- 
pared with writers of the Italian 
school. 525. 

Monts-de-piete, 143-5. 

Moral capital, 388, 446-7, 487, 520. 

Moral restraint (doctrine of Malthus), 
408. 

Morellet (Abbe), 364. Quoted, 376. 

Mortgages. Primitive form of, 18. 
Of crusaders, 129, foot-note. Tur- 
got thought of making m. public, 
376. Restrictions of m. system 
relieved by bill of exchange, 540. 
M. on France, 540. 

Mortmain, 350. Abolished by Const. 
Assembly, 420. In Spain, 526. 



Mun (Thomas), advocated prohibition, 
in E?igland's Treasure by Foreign 
Trade, 300. 

Nantes (Edict of), 225. Revocation 
of, 298-9. 

National Convention, v. Convetition. 

Navigation. Of Greece, 48-9. Of 
Romans, 48-9. Of Carthage, 48- 
50. Of Venice, 200. Promoted 
by crusades, 131 : by Hanse League, 
147 et seq.: by Italian industries, 
198. Encouraged by Colljert, 296- 
7. Prohibited to Spanisli-American 
colonies, 215. 

Navigation Act. Of Great Britain, 
315 et seq., and notes on pp. 317- 
319. A. Smith's opinion of, 317, 
foot-note, A prelude to wars, 333. 

Neri. (Writer on moneys), 261. 

Net product (doctrine of), 353-4, 361, 
373. 379, 386. 

New World. Economic results of its 
discovery, 229-241. 

Nebenius, (German economist), 532. 

Necker, 421, 

Nimeguen (Treaty of), moderated 

tariffs, 289, 306. 
Nobility. Silk n. and wool n., I91. 
Norman pirates, 13 1, 150. 
Normans, 1 19. 
Northmen, 150. 
Novellae, ('of Justinian), 104. 

Obnoxiatio, 122. 

Octroi, 20, 68, note 6, Appendix, 545. 

Office holders, Colbert's opinion of, 
283. 

Orient. Effect of contact with, 7, 

Orphans (rights protected), 104. 

Ortes. On means of remedying pov- 
erty, 524. 

Ovinius, put to death for directing a 
manufactory, 63. 

Owen (Robert). His social system 
and experiments, 508, 516-519. 

Padilla, 216 and foot-note. 
Painters, in Italian Republics, 192. 
Pandects (of Justinian), 102-106. 



578 



INDEX. 



Papacy, the natural protector of eccle- 
siastical demands, 157. 

Paper money, 246. When it expels 
other m., 311. Substituted for 
coin, 326. Used by England 24 
yrs., 331, and n. 22, Appendix. 
Ricavdo on, 259, 332, 457-8. In 
French Revolution, 349, 422. Of 
Law's bank, 337-349. Disturbed 
monetary system, 344-5. A. Smith 
on, 383. Bk. of Eng. bills when 
paper-money, 438. Paper-money 
and money-paper, 478. 

Paris, petitions against high tariff, 281. 

Paris Bros. , authors of the anti-system, 
340 and foot-note. 

Parliaments, origin of, 131. P. of 
Eng. emancipated the blacks, 408. 

Parnell (Sir Henry). On Financial 
Reform, 465. 

Patents, created by Constituent As- 
sembly, to secure inventions, 420, 
421. 

Patricians, 55. At Venice subjected 
to a commercial training, 199. 

Pauperism. At Athens, 15. At Rome, 
56, 63. The poor protected by cler- 
gy, 130. Under Chas. V, 215, 217- 
218, 287, 288. In Eng. and other 
Protestant countries, 221-223, 265— 
6. In France, 373, 393. Attempts 
of the Convention to reform p., 
423. Say's idea of the causes 
of, in England, 450. Ideas of 
Malthas on, 485. Of Godwin, 
393. Of our days, 442. Of Du- 
noyer, 483. Of Vasco, Ricci, and 
Ortes, 524. Treated by Wade and 
Scrope, 465-6. A result of political 
changes, 536. Increased by poor- 
tax, 542. 

Peace, promoted by commerce, 446, 
foot-note. Treaty of, 439. Its ef- 
fect on all countries, 440. Project 
for perpetual, 304, 351. 

Peel's Act, 439, 331. 

Pebrer (quoted on revenue and loans 
of British government,) 436. 

Perfumes — their importance at Rome, 
55- 

Perikles — his system of public econo- 
my, 13 and 14, note, and 16. 

Petition for reestablishment of cor- 
porations. 188. Of citizens of 



Lyons against the custom-house of 
Vienne, 271. Of Paris against high 
tariff, 281. Of city of Bristol, Eng. 
against peace with the U. S., 432, 
and subsequently for increase of 
harbor, 432. 

Phalanstery, 511-13, 515. 

Physiocrates. 485, .',13, 420-21, 415, 
437, 505-6. 

Physiocratie, 356 and n. 17, App. 

Phillippe Auguste, granted a com- 
munal charter in order to protect 
his own rights, 161-2. Ordinances 
of, against Jews, 167. 

Philippe IV. His infractions of the 
laws of trade, 168-173. 

Philip II, 312. 

Philippe le Bel. Ordinances of, 
on coins, 165. Attempts at a maxi- 
7!ium, 166. On Jews, 167. Rejects 
foreign commodities, 168. 

Philip of Macedon, maintained war as 
much with gold as with the sword, 
20. 

Pirates, of Mediterranean, 48. Seized 
Marseilles, 119. In Baltic, 131, 
147. Piracy has ceased, 538. 

Piste (Edict of), 119 and foot-note. 

Pitt's system, supported by Thornton, 
attacked by Cobbett, 455-6. Ri- 
cardo's services to, 457-8. 

Plato, appreciated economic questions, 
8. His Polit. Econ. as shown in 
his Republic, 29-34. On Division 
of labor, 29, 30. On money, 31. 
Common possession of wives and 
children, 32. Community of prop- 
erty, 32. Manual labor, 33. 

Pliny (the elder), deplored the condi- 
tion of agriculture, 54. 

Plurality of offices (at Athens), 17. 

Philosophers (of i8th century), 417. 

Political Economy, as defined by J. 
B. Say, 444. Separated from Poli- 
tics by Say, 443. Became a science, 
441-2. Its scope defined, 448, 
note. See Table of Cotiients. 

Politics. Aristotle's work on, 37-43. 

Poll-tax. Montesquieu on, 410. 

Poor-laws, a result of Protestant Re- 
formation, 223. Reformed in Eng- 
land after the writings of Malthus, 
407. 



INDEX. 



579 



Poor-tax. At Athens, 15. In France 
under Charlemagne, 112. A prin- 
cipal cause of maintenance of corn- 
laws, 424. Increased pauperism, 
542. 

Poor (the), cared for by Colbert. 293- 
4. In England under Elizabeth, 
266. 

Pope (the). Power of, 79. Intervenes 
between barons and clergy, 130, 
131. 

Population (Malthus on), 393-404. 
Godwin on, 393, 404-5. Everett 
on, 405. Sismondi on, 469. Of 
city and country contrasted, 549. 

Post-office, in France, improved by 
Colbert, 297. 

Potato. Its discovery worth more 
than the mines of Peru, 262. 

Poulain. Writer on moneys, 261. 

Poverty. See Pauperism. 

Price (Dr.) Economist of the shade 
of Gournay, 364. Theory of Amor- 
tization by, 436 and n. 21, Appen- 
dix. V. Amortization. 

Prices. Attempts to regulate, by law, 
169-173. Effects of expansion and 
contraction of the currency on, 247, 
252-258. Illustrated by Law's sys- 
tem, 352. By the assignats, 422. 
History of p., by Thomas Tooke, 
462 and foot-notes. 

Priests. Beginning of their authority, 
73. Their power, 79-Sr. To-day 
unequal to their task, 84, 85, 478. 
Condemned loans at interest, 105. 
Censured by Charlemagne, 112, 113. 
Exempt from military service, 113. 
Practiced usury, 113. Kept women, 
113. Tributary to Jews, 140. 
Slaughtered 265. See Clergy. 

Primogeniture, existed at Sparta, 26. 
Not in Institutes of Justinian, 105. 
Attempt to restore, in France in 
18 1 5, 450. Abolished by French 
Revolution, 535. 

Printing, 225. 

Prison-Reform, 481, note. 

Privileges, of benefices, became heredi- 
tary, 98, 116, 117. Of clergy, op- 
posed, 130, 212. Of communes, 
how obtained, 161. Differing from 
mixnicipal franchises, 161. Of 
lords, V. fstidal system. Attempts 



to restore p., 450. Of every kind, 
abolished in French Revolution, 
535. 
Products. Of Roman tributaries, 65. 
Of Italian Republics, 192, 196, 197, 
198, 202-3 et seq. Of Hanse com- 
merce, 150, 153, 154. Imposed 
on colony, 215. In privileged 
companies, 234, Colonial products, 
238. Silk in France, 268. Pro- 
duction under Colbert, 292. In 
Eng., France and Holland, 320, 
332. Economist idea of p., 354, 
379, 380. Curb on production, 390. 
Exclusion of, 425. J. B. Say on 
immaterial products, 447. We con- 
sume hundreds of millions of pro- 
ducts unknown to our fathers, 538, 
546. 

Prohibition. To export grain, under 
Charlemagne, 114. By Philippe le 
Bel, 166, 168, 172. By Chas. V, 
212. To export money, 166, 174, 
266, 269, 299, 526, 311. Corn -laws 
prohibitory, 424. P. at Venice, 
200. A cause of her decline, 202. 
* Futility of, 214, 311. P. to export 
specie advocated by Lord Davenant, 
Thomas Mun, Sir Jas. Steuart, 
Melon, Forbonnais, Genovesi and 
Ustariz, 300. v. Mercantile System, 
305-313 et seq. Prohibitory tariffs, 
307, 423. Voltaire advocated p., 
415. D'Hauterive quoted on p.- 
laws, 319. Great error of the sys- 
tem, 425. Opposed by Turgot, 373. 
Bad effects of, 426. Say's argu- 
ment against, 445. P. opposed by 
Huskisson, 309, 462. Attacked by 
St. Simonians, 499. P. system in 
Spain, 526. 

Proletaries, 56, 57, 396, and n. 7, App. 

Proletaires, 223. 

Proletariat, 546. 

Property. At Athens, 24. In Sparta, 
26-7. In land, in Greece, 37. Of 
women, at Rome, 78. Among Bar- 
barians, 97-99. Under Justinian, 
105. In land, under feudalism, 120, 
123. Of crusaders, 126-7. P- 
rights under Justinian, 105. Sale 
of landed p. by crusaders, 127. Of 
churches should be taxed, 130. 
Church p. exempted from taxes, 156. 
Confiscated and sold in Europe, 221 
227, 265. Personal p. attains dig- 



S8o 



INDEX. 



nity, 163. Its importance in Italian 1 
republics, 190-208. Tax on per- 
sonal p., 421. Division of landed 
p., 349. 351, 420. Rights of p., 
427. P. in inventions secured by 
patents, 420, 421. French demo- 
cracy unjust to landed p. , 435. Im- 
material p., 447. P. under Fou- 
rier's system, 512. Abolition of, 
advocated by Owen, 516. Effect 
of French Revolution on landed 
property, 535. Personal p., 545. 
Increased value of landed property, 
546. 
Prostitutes, 393. 
Protection, Colbert aimed to make 

customs a means of, 283-4. 
Publicity of accounts. At Athens, 12. 

Of mortgages, 373. 
Public works. Of Athens, 11, 18, 
foot-note. Roman Roads, 58-62 et 
seq. , and aqueducts, 58. Roads of 
France, 296, 369. J. B. Say's 
opinion about government interven- 
tion in industrial enterprises, 448, 
449, 452. Changed views, 532," 
539. 54i- 
Public debt, 342. Of Eng., 436 and 
foot-note, 437, 440. Debt of 
France in time of Sully, 256-7, 277- 
Of France, funded, 423. 

Quebec — colonized, 297. 

Quesnay. Chief of the Economist 
school, 352. Analyzed agriculture, 
353. Doctrines of, foot-note 356- 
360, 357-360. Tableati Economi- 
que, 356-7. Other works, 357. 
Marmontel on Q., 362-3. Charac- 
ter and style of, 363. Disciples, 
364- 

Rate of interest, v. Interest. 

Rational ium Imperii^ 68. 

Rau (Prof.), 531. 

Raynal, 408. Precursor of the grand 
masters, 409. Denounced trade in 
blacks, 411, 418. Worked for the 
political revolution, 417. His His- 
toire Philosophique, 418. Charac- 
teristics of, 417-18. Speaks of 
Polit. Econ., 378. Prophecies of, 
fulfilled, 432. 

Recoinage, 119, note; 174, 250, 341. 



Reform. Edicts of Charlemagne, 109. 
R. in church property, 221 et seq., 
265. Of Protestantism. 296-298. 
In taxation, 421. Reforms of 1789, 
420 et seq. Of criminals, 545. 

Reformation (Prot.), 9, 219-228, 29S 
et seq. 

Religion. Its power and economic 
effects, 79-86. A universal religion 
anticipated, 534. Owen's manifesto 
against religions, 517. v. Clergy, 
Priests, Convents, Chttrch, Chris- 
tianity, Reforniatio7t. 

Republic. Plato's work on an ideal 
Republic, 29-34. 

Republics (Italian). Their marvelous 
growth, and commercial, industrial 
and economic importance, 190-208. 

Restriction (or suspension) of Bank of 
Eng., 330, 331, 437-439- 

Restrictive system. 114, 134, 166, 
174, 176, 200, 202, 213-14, 300, 

305-15. 319. 373. 390, 415. 423. 
425, 426. V. Pi'otection, Prohibi- 
tion, Exclusive System. Also Free 
Trade. 

Resumption of specie payments (by 
Bk. of Eng.), 331, 438-9. n. 23, 
Appendix. 

Revenue. Of Athens, 19. Of Rome, 
246. Of Attika, (Treatise by Aris- 
totle), quoted, 10. Of Florence, 
192-3. Of Venice, 204-5. Of 
France under Charlemagne, 1 1 3, 
114. Under Sully, 267. Under 
Colbert, 283-4, 286-9, 293, 302-3. 
Bank of Law collected revenues of 
the State, 338-9. Under Turgot, 
373> 374- Indirect taxes the princi- 
pal source of, in Eng, and U. S., 
545- 

Revocation, v. Edict of Nantes. 

Revolution, v. French Rev. 

Ricardo, 456-460. Economic value of 
his contributions to finance, espe- 
cially of his work, " The high price 
of bullion a proof of the deprecia- 
tion of bank-notes," 456-7. His 
" Proposals for an economical and 
secure cunency," 457-8. His opin- 
ion of the perfect condition of mon- 
ey, 259, 332. On the effect of taxes 
on industries, 435, and n. 20, Ap- 
pendix. His doctrine of agricultur- 
al rents, 458-9. On method of pay- 



INDEX. 



581 



ing public debt, 460 and n. 25, Ap- 
pendix. Opposed to J. B. Say on 
some points, 450. 
Ricci. Remedies for poverty, 524. 

Richelieti. Prodigal of his resources, 

279. 
Rigord, quoted on Jews, 141. 
Ripuary Law, gave clergy power over 

their conquerors, 96. 

Riviere (Mercier de la). Advocated a 
monarchy, 358-9. His other doc- 
trines, 360-1, 364. 

Roads. At Athens, 11. Rome, 58- 
62. In France, 296, 369. Modern, 
547- 

Rodrigues (Olinde). Collated St. Si- 
mon's writings, 498. 

Roederer, 421. Opposed Constitu- 
ent Assembly on method of taxa- 
tion, 361, 498. 

Romans, their Polit. Econ., 47-70. 
Left works on economic subjects, 

. 421. 

Roundsmen, 222. 

Royal Tithe (project of), work by 

Vauban, 302. 
Rousseau (J. J.) Quoted on slavery, 

34. Speaks of Polit. Econ.. 378. 

On cominerce, finance, taxation, 

agriculture, &c., 413, 414. 

Russell (Lord John), 318, foot note, 
319-20, foot note, on the course 
Great Britain should pursue toward 
her colonies. 

Saint Domingo, 234. 

Saint Just, in Nat. Convention, on 
maximum, 172-3. Precursor of 
masters in political science, 409. 
Characteristics of, 427. 

Saint Pierre (Abbe of). Project for 
perpetual peace, 304, 451. 

Saint Peravy, 364. 

Saint Simon, 408, 495-507- His Pa7-- 
nble, 497-8. Other writings, 498- 
9. Doctrine of property ,^gjj_„ Of 
inheritance, 501, 503. CKher doc- 
trines, 504 et seq. His services and 
errors, 504-6. Compared with Owen 
and Fourier, 508-9. 

Saladin Tithe, 128. 

Salic lands, free from taxes, 98. 



Sandi, (author of Storia Civile di Vc' 
nezia,) quoted, 198. 

Santoro (Valle), 527. 

Savings banks, 534. v. Batiks. 

Say (J. B.), 442-453- His TMorie 
des Debouches, 444 et seq. His 
characteristics, 446 et seq. Com- 
pared with Sismondi, 447. Agreed 
with Malthus on population, 450, 
452. On balance of trade, 451. 
Views on banks, 329. On other 
questions, 452. Subordinated the 
phenomena of the circulation to his 
theory of access to markets, 485. 

Scania, 150. 

Scarufh (Gaspardo). Writer on mon- 
eys. Proposed the gold and silver 
mark, 261, and a universal medium 
of circulation, 522. 

Schmalz, 531. 

Scrope (G. P.), 465-6- 

Sculptors, in Ital. Republics, 192. 

Sectionists, 16 and n. 5, Appendix. 

Secularization of Church property, 
221, 226-7, 265. Of holy days, 221, 
dictated by reason and necessity, 
223. Economic results of, 224 et 
seq. Secularization of monks, 221- 
2. 

Sempronian Law, created a maximum 
price for grain, 62. 

Senac de Meilhan, quoted on Turgot, 
375. 

Serfdom. Its origin, 89. Classes and 
conditions, 122-3. 

Serra (Antonio). Author of a work 
on gold and silver, 260, 522. 

Silver. At Athens, 20-22. Xeno- 
phon on, 36-37. Its export pro- 
hibited, 166. By Sully, 269. Not 
a true source of wealth, 241. 

Sinking-fund. See Amortization and 
7iote 21, Appendix. 

Sismor.di. 468 et seq. Shows ill ef- 
fects of unlimited competition, 8. 
On Banks, 329. Believes in legal 
remedies, 407-8. Shows abuses of 
division of labor, 444. Attributed 
great importance to revenue, 465. 
Compared with J. B. Say, 444, 447. 
Opposed Say on some points, 450. 
Adopted theories of Malthus on 
population, 469-470. Other doc 



582 



INDEX. 



trines of, 470 et seq. Errors of, 
471. Reception of his work, 479. 
His services, 481. His work com- 
pared with that of Dunoyer, 484. 

Slavery, a characteristic of ancient 
Polit. Econ., 5. Modified by Chris- 
tianity, 6. In Greece, 11. Xeno- 
phon on, 10, 521. Rousseau's view 
of, 34. Aristotle's, 37, 38. Slaves 
excluded from benefits of associa- 
tion, 36. At Rome, 55, 63. Slaves 
freed, 78. How affected by Canin- 
ian Law, 62. Competition of slaves, 
at Rome, 57. Great works done by 
slaves, 68. S. among Barbarians, 
g7. Under Justinian, 104. Re- 
stricted by Charlemagne, 115. 
Slaves as money, 250. Trade in 
slaves disparaged by the Church, 
250. Quotation on, from d'Hau- 
terive, 319. S. satirized by Mon- 
tesquieu, 410. Denounced by Ray- 
nal, 418. Abolished by Russia, 
486, foot-note. Explained by Storch, 
486 and foot-note. Effects ^of, on 
masters and slaves, shown by Comte, 
480. " Slavery of the useful occu- 
pations the economic regime of 
every newly established society," 
quoted from Dunoyer, 34. S. in- 
terdicted by treaties, etc., 537. 

Smalkalde (League of), 219. 

Smith (Adam.) 37S : 379-391- Pe- 
riod of his labors, 380. Method of 
study, 380. Definition of wealth 
and of capital, 382 : division of la- 
bor, 382 : demand and supply, mon- 
ey and credit, 383 : value in use and 
value in exchange, 383 : Price, 382, 
384 : functions of money, 384 : 
banks, 329, 383, 437 : laws that 
govern wages, 384 : capital distin- 
guished as fixed and circulating, 384. 
Interest of money, 384-5. Similar- 
ity of views with Turgot on this 
and other points, 377. Machines, 
385 : free trade, 385 : Taxation, 
385-6. Moral capital, 388. His 
views compared with those of the 
Economists, 385-6. On trade, 388. 
Effect of his work, 392. His view 
of the Navigation Act of England, 
317, foot-note. Advocated unlimited 
competition, 442. His estimate of 
the increase of prices within 60 or 
70 years, 253. What manufactures 
owe him, 390. Effects of his teach- 



ing, on belief in the doctrines of 
balance of trade, restrictive system, 
agricultural systeni, etc., 454. 

Smuggling, 309-11. v. Contrabandage. 

Socialism. See Owen, 516 et seq. 

Social Economists of the French 
School, 468 et seq. 

Societary system of Fourier, 508 et 
seq. 

Soden (Count of), His divisions of 
Polit. Econ., 531. 

Solidarity of nations, demonstrated 
by J. B. Say, 79, 206, 228, 411, 
432-3. 445. 

Sons, acquire legal right to their own 
lives and to property, 104. 

Spanish School of Economists (Char- 
acteristics of), 526-7. 

Sparta, (Polit. Econ. of) 25-29. Rous- 
seau's doctrines led to regime of 
Sparta, 413. 

Specie, v. Gold and Silver: also. 
Money. 

Spinning-machine, 390, 430-432 and 
foot-note. 

Statistics. Importance of, to Polit. 
Econ., 542-3 et seq. 

Steamboats, 400, 538. 

Steam-engine, 548. 

Sterling money (origin of name), 155, 
foot-notes. 

Steuart (Sir Jas.). Commercial errors 
of, 300. Writer on banks, 329. 

Storch (Henri), 486-488. Character 
and importance of his services to 
Polit. Econ., 486. His classifica- 
tion of nations, 486. On slavery, 
486, 488. On the income of talents 
and qualities, 486-7. Rent, 487. 
Money, 488. Opposed to Say on 
some points of doctrine, 450. 

Strangers, protected, 130. 

Subordination, of all classes, at Rome, 
63. A doctrine of the Christian 
Church, 77. Taught by Econo- 
mists, 357, foot-note. By St. Si- 
monians, 505-6. 

Suger, (Abbe) quoted, p. 160. 

Sully, 267-278. His financial reforms, 
267-8, 277. Encouragement to 
agriculture, 268. Erroneous ideas 
on manufactures and trade, 268-9, 



INDEX. 



583 



272. Inclination to sumptuary laws, 
270. Stored up money, 273. Eco- 
nomic services of, 277-8. His fa- 
mous maxim, 351. 

■Sumptuary laws. At Rome under 
Tiberius, 68. Other laws, 167, 168, 
175. Under Sully, 270. 

Sunday. Observance of, recommended 
by Constantine, 73. A day of uni- 
versal rest, 79, 80. 

System. Colbert's, 279, et seq. John 
Law's, 333-351. Of weights and 
measures planned by Charlemagne, 
114. Decimal system of weights 
and measures, adopted by National 
Convention, 421. Mercantile sys- 
tem, 305-521. (v. in. s.) 

Tableau Economique '■Economic Ta- 
ble), 356-360. When published, 
380. 

Taille, 122, 282. 

Tariffs, 153. T. wars, 239, 306, 425. 
T. revised by Colbert, 283, 288. 
T. moderated at treaty of Nime- 
guen, 289, 306. Protests against 
high tariffs, 271, 281. Effect of 
smuggling on tariffs, 309-11. T's 
since Continental Blockade, 425. 
Since 1815, 425. 

Taxation. At Athens, 11 ; of allies, 
13 ; poor tax, 15 ; for other pur- 
poses, 16-20, 23. At Sparta, 26. 
Various taxes under Roman govt., 
52, 60, 66-70, 75 ; paid in gold, 75. 
Under Constantine, a direct tax, 75, 
76. Under Charlemagne, 112. Vil- 
lein tax, 122. Saladin Tithe, 128. 
Of church property demanded by 
barons, 130; by bourgeois, 157. 
In Middle Ages, on commerce, 134. 
Of Hanse, 152. In Italian Repub- 
lics, 193 et seq. Taxes anticipated 
by Chas. V., 217. Relief from T. 
sought by confiscation of church 
property, 265. Reform in T., 266, 
originated in Protestanism, 220. T. 
reform of Sully, 267 et seq. Evils 
of excessive T.,281. T. under Col- 
bert, 283 et seq. Under Vauban, 
301 et seq. T. in Eng. , 295. In 
France under Louis XV, 335. 
Lyons and Paris petition for reduc- 
tion of T., 271, 281. Basis of T., 
according to economists, 354. In- 
direct taxes and personal taxes 



opposed by economists, 361, Indi- 
rect T. not opposed by the masses 
in Fr. Rev., 393. Colbert's ideas 
on taxation, 282, 299. Vauban's, 
301 et seq. Boisguilbert's, 303. 
Economists', 354, 361, 357, foot- 
note. Mercier de la Riviere's, 361. 
Adam Smith's, 385. Dupont de 
Nemours' and the Physiocrates', 
421. Rousseau's, 413-415. Roe- 
derer's. 361, 421. Ricardo's, 435 
and n. 20, Appendix, 459-60. Es- 
trada's, 493. Sir Henry Parnell's, 
(on reduction of t.,) 465. T. of 
Constituent Assembly, 420-1. Per- 
sonal tax, 361. Land tax of Const. 
Assem., 420. Objective point of 
taxation, 434. Effect of wars on 
T. in Eng., 435-6. T. in France, 
since French Revolution, 536. 

Temple (SiitWm.), quoted on shipping 
of the Dutch, 314, 315. 

Terentian law. Provided a distribu- 
tion for indigent citizens, 62. 

Terray, 352 and foot-note. 

Theft, encouraged at Sparta, 27. 

Themistokles, 19. 

Theophrastus, author of work on me- 
tallurgy, 20. 

Theorikon, ) 12, 14, 16 and, note 2, 

Theorika, \ Appendix. 

Thiers, quoted on laws, 292. Quoted 
on Jn. Law's bank, 342, 343, 34, 

Third estate, origin of, 157 ; made 
possible by crusades, 133. 

Thornton (Henry), work of, justify- 
ing the bank suspension, and ideas 
of, on banks, 455. 

Tithes (Ecclesiastical), relief from, 
sought by sale of Church property, 
227. Effect of, in Spain, 527. 
Saladin tithe, 128. T. abolished 
by French Revolution, 535. Tithe 
of our day, 537. 

Tolls. Number and variety of, in 
Middle Ages, 134. Toll houses 
under Chai'lemagne, 114. 

Tooke (Thomas), 462 and foot-notes. 

Torrens (Robert), 461 and foot-notes 
on page 462. Author of work on 
"Sir Robert Peel's Bill of 1844," 
462, foot-note. 

Trade, v. Commerce. 



584 



INDEX. 



Trade, v. Commerce. 

Trades. Under protection, of special 
gods, 71' Ii^ convents, 82. T. 
corporations, 177-200. 

Tiade-unions, 479. 

Tramps. Fronn convents, 221-2. Ef- 
forts to compel them to work, 222, 
223. Efforts to suppress. 112, 222, 
265, 281, 294. V. Vagrants and 
Mendicancy. 

Transit, 544. 

Tribonian. Labors of, on Code of 
Justinian, 103 et seq.' 

Tributes to Roman Gov't, 65. 

Truce of God — put the laborer under 
protection of the church, 130. 

Trudaine, 364. 

Tucker (Josiah). Economist of the 
shade of Gournay, 364. A revered 
name, 387. ■ • 

Turgot, 366-378. Suppressed cor- 
porations, 188. Eclectic, 364. His 
ministry the doctrine of the Econo- 
mists carried into action, 366. Re- 
forms, 367 et seq. Opposition he 
encounters, 365, 367. Sympathy 
with laborers, 371. Advocated 
free-trade and land-tax, 366, 373. 
His Treatise on the Formation and 
Distribution of Wealth, 377. Opin- 
ions on influence of rate of interest 
on enterprises, on taxation, and 
other economic questions, 373, 377. 
Precursor of A. Smith, 377. His 
character, 364. A revered name, 
387. His principal merit, 379. 
Obliged to recoil before opposition, 
427- 

Ulloa (Don Bernardo de) quoted on 
metallic wealth, 307, note. 

United States. Econ. results of their 
independence, 432. Lord John 
Russell's allusion to conflict of Eng. 
with, 320. Precipitate bankruptcy 
of their bank, 349. 

Ure (Dr.) Work on Philosophy of 
Manufactures, quoted, 466. 

Ustariz. His ideas on export of mon- 
ey, 213 and footnote, 300. 

Usury. Li Greece, 21. At Rome, 
51. Priests forbidden to take, 113. 
Laws against, by Louis IX. and 
and his successors, 166. v. Interest 
(rate of). 



Utopian Economists, 508-520. 

Utopias, 379, 425. 

Vagrants, 221-2, 281, 112, 265, 294. 

Valence (customs of), 270-1-274, 281. 

Value. A. Smith's definition of, 355-, 
361. V. of money from law (Aris- 
totle's view), 39- Economist's idea 
of v., 353. Say's theory of, 444. 
Changed values, a result of civiliza- 
tion, 549. 

Vasco, Italian writer on moneys, 261. 
On poverty and inheritance, 524. 

Vauban, on condition of French peo- 
ple, 301. Author of Project of a 
Royal Tithe, 301, foot-note. Ideas 
of, on taxation, 301-2. 

Venice. Her industries, 190 et seq. 
197. Freedom, 191. Commercial 
prosperity, 192, 197 et seq. 270, etc. 
Financial budget, 204-5. (ilory 
and success, 270-2. Bank, 196-7. 
Causes of decline, 199 et seq. Pros- 
perity, due to free-trade, 199-201. 

Verres, financial operations of, 6. 

Verri, 523-4. 

Vessels, by whom constructed at 
Athens, 11. Of Carthage, destroyed 
by Rome, 48. 

Vienne, in Dauphiny, 140. Customs 
of V. 270-1.274, 281, 

Villani's list of revenues of Florence, 
192-3. 

Villeins, 122, 177. 

Villein-tax, 122, 282. 

Villeneuve-Bargemont. His Chris. 
Polit. Econ., 407, 481. On Pau- 
perism and evils of the manufactur- 
ing system, 476, foot-note. Plan 
for amelioration, 478, His work 
compared with that of Droz and 
Dunoyer, 484. 

Voltaire. Econ. writings of, 415—17. 
Hommes aux Quarante Ecus, 415. 
Partakes of worst errors of balance 
of trade, 415. V's doctrine of 
/rrt^^ contrasted with that of J. B. 
Say, 445 and foot-note. Precursor 
of the masters in Economic Science, 
409. 

Wade (John), History of Middle and 
Working Classes, 465-6. 

Wages, of masons employed on Stras- 



ft/lAY 3-194fl 



INDEX. 



585 



bourg Cathedral, 251. Wages mid 
Combinatio7is, by Col. Torrens, 461. 
Liberal wages in Spanish colonies 
encouragement to marriage, 232. 

VVar. Its disadvantages shown by J. 
B. Say, 451. 

Wardenships. Effect of their aboli- 
tion, 536. 

Warner (A. J.), quoted on production 
of precious metals, 257, foot-note. 

Watt. Results of his invention, 430 
et seq. 

Wealth. Economists' notion of, 353. 
A. Smith's, 355. " Wealth "of Na- 
tions," 454. (v. A. Stnith.) 

Weights and Measures (System of), 
ordered established by Charlemagne, 
114. Unity of, established by Na- 
tional Convention, 421. 

West India Co. Origin and history 
of> 339 et seq. Connection with 
Law's bank, 338 et seq. Sudden rise 
of shares, 340 et seq. Legislation to 
affect shares, 340, 342. Stock-Job- 
bing, 341 et seq. Enormous rise of 
shares, 343. Desperate measures to 
sustain their value, 344. Bankrupt- 
cy, 345- 

Wife. Her rights at Sparta, 26. 
Community of wives, 28. Com- 
munity of w's advocated by Plato, 
32. Considered a possession by 
Plato, 32 : by Colbert, 300. Xeno- 
phon's ideas of, 35, 38. W. at Rome 
degraded to tutelage, 63. Separa- 
tion of husband and wife forbidden 
by Charlemagne, 115. Wives of 
Jews, 249. W. of Yves, granted the 
grandmastership of certain trades, 
179. 

Wilberforce. His good judgment 



brought about emancipation of the 
blacks, 408. 

Will, making a, prohibited under cer- 
tain conditions, 11 ; prohibited to 
serfs, 122. 

Woman. Her education and treat- 
ment at Sparta, 27-8. How viewed 
by Plato, 32 : by Aristotle, 38. Ex- 
emption of her property from confis- 
cation, a result of Christianity, 78. 
As wife at Rome, 63. Concubine 
of Roman governors, 75. Divorce 
of, 104. Property rights of W. 
under Justinian, 105. Kept by 
priests, I13. Under protection of 
French chivalry, 124. Widows and 
orphans protected by clergy, 130. 
W. desired by Crusaders, 128 (note). 
Excluded from corporation of em- 
broiderers, 186. Violated, 265. 
Wife of Yves granted the grand- 
mastership of certain trades, 179. 
Helpless and prostitutes, 393. 
Emancipation of (crazy attempts 
at), 499, 502. 

Wool, never encouraged at Rome, 65. 

Workmen, under feudalism, 122. Per- 
mission to labor a royal or domanial 
right, 272. W. in Italian Repub- 
lics, 180-203. Ill corporations, 
183-188. See Labor. 

Wreckers Right, 147. 

Xenophon, on modern econ. questions, 
8. On slavery as a source of revenue, 
10. Naturalness of slavery, 37. 
]\Ianual labor, 33, 35. Function of 
money, 242. On silver, 36, 37. 
Marriage, 35. Inferioi-ity of fe- 
males, 38. 

Zacharise (K. G.;, 532. 













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